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COLCHESTER Economic Viability Study

Three Dragons and Troy Planning + Design

June 2017

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THREE DRAGONS and TROY PLANNING + DESIGN Colchester Local Plan Viability

Study

THREE DRAGONS

http://three-dragons.co.uk

01908 561769

4 Leafield Rise, Two Mile Ash,

Milton Keynes MK8 8BU

TROY PLANNING + DESIGN

www.troyplanning.com

0207 0961 329

3 Waterhouse Square,

138 Holborn, London EC1N 2SW

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This report is not a formal land valuation or scheme appraisal. It has been prepared using the Three

Dragons toolkit and non-residential model and is based on local data supplied by Colchester

Borough Council, consultation and quoted published data sources. The toolkit provides a review of

the development economics of a range of illustrative schemes and the results depend on the data

inputs provided. This analysis should not be used for individual scheme appraisal.

No responsibility whatsoever is accepted to any third party who may seek to rely on the content of

the report unless previously agreed.

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Contents

EXECUTIVE SUMMARY ................................................................................................................................5

Residential Development .........................................................................................................................6

Non-residential Development ..................................................................................................................8

1 INTRODUCTION ......................................................................................................................9

Purpose of the Economic Viability Assessment .....................................................................................9

National Planning Context ..................................................................................................................... 10

Other Guidance on Viability Testing for Residential Development ................................................... 13

Local Planning Policy Context ................................................................................................................ 14

Research Evidence ................................................................................................................................... 18

2 VIABILITY TESTING – RESIDENTIAL DEVELOPMENT ........................................................... 19

Principles and Approach ......................................................................................................................... 19

Land Value Benchmarks ......................................................................................................................... 20

Testing approach and assumptions ...................................................................................................... 24

3 RESIDENTIAL VIABILITY ANALYSIS – NOTIONAL 1 HECTARE SITE..................................... 27

Testing Results ......................................................................................................................................... 27

Notional 1 hectare scheme – Tiptree & Rural ....................................................................................... 27

Notional 1 hectare scheme – Central .................................................................................................... 28

Notional 1 hectare scheme – All Schemes at Sensitivity Benchmarks .............................................. 29

Notional 1 hectare scheme – Overview ................................................................................................ 31

4 RESIDENTIAL VIABILITY ANALYSIS – CASE STUDY SITES .................................................... 32

Case study characteristics ...................................................................................................................... 32

Small/Medium Case Studies (Case Studies 1 to 8) ................................................................................ 33

Small sites below 11 units .................................................................................................................................... 33

Small – Medium Sites ............................................................................................................................................ 35

Intermediate Case Studies (Case Studies 9 – 11) .................................................................................. 38

Larger Case Studies 600 & 1100 dwellings (Case Studies 12 to 13) ..................................................... 39

Rural Exception Site (case study 4) ........................................................................................................ 41

Sheltered & Extra Care Sites (case studies 14 & 15) ............................................................................. 42

Case Studies – Overview ......................................................................................................................... 43

5 NON-RESIDENTIAL DEVELOPMENT ..................................................................................... 44

Introduction ............................................................................................................................................. 44

Case Study and Testing Assumptions .................................................................................................... 45

Summary Viability Assessments ............................................................................................................ 54

B-Class Uses – Offices, industrial and warehouses .......................................................................................... 55

Retail Uses .............................................................................................................................................................. 56

Other Tested Uses................................................................................................................................................. 57

Other Uses ............................................................................................................................................................. 58

Summary .................................................................................................................................................. 60

APPENDIX I – TECHNICAL DETAIL FOR RESIDENTIAL TESTING ............................................................. 62

APPENDIX II – LOCAL PLAN POLICIES ..................................................................................................... 72

APPENDIX III – STAKEHOLDER WORKSHOP PRESENTATION & NOTES .............................................. 123

APPENDIX IV – RESULTS TABLES ........................................................................................................... 140

APPENDIX V – NON-RESIDENTIAL VIABILITY TESTING ........................................................................ 146

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Executive Summary

1. The Colchester Borough Council Viability Study provides the Council with evidence to assist

it in drawing up its Local Plan, including its affordable housing policies. The evidence has

been prepared in consultation with the development industry and has followed the

relevant regulations and guidance and is in line with the National Planning Policy

Framework. This assessment also takes into account the policies in the new Local Plan and

its supporting evidence base.

2. Colchester Borough Council is aligning the development of its Local Plan with Braintree

District Council and Tendring District Council (the Partner Authorities) to cover growth in

North Essex to 2033 and beyond.

3. The Partner authorities are currently preparing a combined strategic Part 1 Local Plan

which will set out the opportunity for cross-boundary Garden Communities. The Part 2

Emerging Local Plan will include the allocations and policies needed to jointly deliver the

predicted growth within the Partner Authority boundaries to 2033. Each council will

produce a separate Part 2 Local Plan and this Viability Study is to inform the Pre-

Submission consultation for this Part 2 Local Plan.

4. The councils recognise the importance of producing a plan that is viable and deliverable

and has commissioned Troy Planning + Design and Three Dragons to assess viability. The

Viability Study has demonstrated that the Local Plan policies in relation to residential

development are financially viable for most types of development tested and that a policy

requiring 30% affordable housing on sites over 10 units (and sites of 6 to 10 units in

designated rural areas) is achievable. In most cases the council’s policies in relation to

accessibility & adaptability of dwellings (Part M of Building Regulations 2015) and 5% self-

build plots on sites over 100 units are also achievable.

5. The recent Housing White Paper (February 2017) suggests that all sites over 10 dwellings

may have to meet a requirement for 10% of units to be affordable home ownership. If this

become a national policy requirement and the low-cost home ownership replaces other

affordable housing, it will not affect viability on the schemes tested in this study.

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6. The testing undertaken uses a standard residual land value approach, using the Three

Dragons Toolkit for residential development and the Three Dragons Non-Residential

Model for non-residential development. The residual value of development (total value

less all development and policy costs, including planning obligations) is compared to a land

value benchmark and the scheme is said to be viable if the residual value exceeds the

benchmark. Note that the benchmark land value is an estimate of the lowest value that a

landowner may accept, and does not preclude the possibility that some schemes may have

enough value to pay more for land.

Residential Development

7. The testing for residential development was undertaken in two ways

• Generic testing for 1 ha sites with different densities of 25/30/35 & 40 dwellings per

hectare which provides an overview of the viability of the whole plan

• As a set of case studies, ranging from 1 to 1,100 dwellings, representative of sites

proposed in the Local Plan

8. A full list of the case studies is available at Appendix I.

9. The borough was divided for testing purposes into two value areas; Central and Tiptree &

Rural. House prices and land values are generally higher in the Tiptree & Rural area than

in the Central area.

10. The testing has taken account of the policies in the council’s Local Plan. In particular, the

council wanted to accommodate key housing policies liable to impact on viability:

• Affordable housing – Policy DM8 requires 30% of housing to be affordable on sites

over 10 dwellings and 30% on sites of 6-10 dwellings in designated rural areas (Areas

of Outstanding Natural Beauty – AONB); the council requested that varying levels of

affordable housing be tested in order to ascertain how best to meet the need

identified in the SHMA;

• Accessible and Adaptable homes – testing took account of need for a higher level of

accessibility & adaptability under Part M of the Building Regulations - 10% of market

housing and 95% of affordable housing to be reach Part M4 (2) Accessible and

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Adaptable standard and 5% affordable homes to be to Part M4 (3)(2)(b) Wheelchair

User dwellings;

• 5% of plots on sites over 100 dwellings to be serviced plots available for self-builders.

11. No CIL charge was applicable as the council has not yet implemented a CIL. S106

contributions were included in the viability testing, varying by differing site sizes.

12. Sensitivity testing was carried out using a high cost scenario, taking account of the potential

for high infrastructure requirements or land remediation on sites of 300 dwellings or

above.

13. The testing undertaken for the notional 1 ha sites provides an overview of the viability of

the whole plan. The residual values from notional sites are tested against the benchmark

land value. The results vary from location to location but in all areas and in all scenarios

produce a surplus over the benchmark land value.

14. The majority of the case studies, including the larger sites, also produced a positive

residual value over the benchmark land value, demonstrating that policies in the Local Plan

are achievable, including those outlined in paragraph 10 above.

15. Sheltered and extra care schemes are viable at the policy position.

16. The Rural Exception Site was modelled to evaluate whether the inclusion of market

housing would assist deliverability. Using a mix arrived at following consultation, a level of

20-30% market housing was required to achieve viability, depending upon value area.

Clearly, in practice, this will need to be assessed on a site by site basis as the size and

tenure of dwellings on such sites will vary according to locally identified need.

17. Small sites of 6-10 units in the areas of AONB are capable of providing affordable housing

(as a commuted sum).

18. There were some exceptions to the results where sites were not financially viable. In

particular, the flatted schemes were not viable in either value area, reflecting the high cost

of building out such schemes. In practice, policy requirements for affordable housing and

Part M would need to be relaxed to bring these schemes forward. Nonetheless, at today’s

costs & values, even with a reduced policy position it is likely that flatted schemes would

be at the margins of viability, particularly in the Tiptree & Rural Area, without a reduction

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in land cost. This does not preclude development of flatted schemes later in the plan

period when values may have risen above costs.

19. Both the large schemes, 600 and 1,100 units, were viable in both value areas. At the ‘high

costs scenario’ the schemes were viable in the Tiptree & Rural area but resulted in a

marginally negative residual value in the Central Area. In practice, such additional costs

would likely mean that the land value would flex to accommodate them.

Non-residential Development

20. The Report provides viability analysis of the non-residential development planned to come

forward under the new local plan.

21. Of the uses tested, only retail comparison, in and out of centre, convenience retail and

budget hotels are viable. These types of development can come forward subject to the

availability of sites.

22. Based on the costs and values in this testing, speculative office, industrial and warehouse

developments are unlikely to be brought forward by the market at this point in time.

However, this does not preclude local authorities developing new employment spaces, in

order to deliver economic development benefits. In addition, public sector funding from

sources such as the South East LEP can be used to reduce the costs of providing new

employment space. It is also likely that businesses will continue to commission design and

build workspace development.

23. High street comparison retail is marginally viable as modelled here. However, this is in

part due to the relatively high existing use value assumed for the prime retail site. If a

lower value site is available, then this type of retail is more likely to come forward.

24. Based on the costs and values in this testing, student accommodation, care homes and

leisure development are not viable. However, it would only require a 2% increase in values

for student accommodation to become viable and given that this is within the variance in

the data used to estimate the values it seem likely that this type of development will be

viable, particularly if developed on campus where the land may be obtained at below

commercial rates. This is confirmed by evidence of student accommodation delivery on

the campus and recent delivery / schemes in the pipeline elsewhere in the Borough.

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1 Introduction

Purpose of the Economic Viability Assessment

1.1 The viability evidence provided in this report is to support Colchester Borough Council

in drawing up its Local Plan, including Affordable Housing Policies. The evidence has

been prepared in consultation with the development industry and has followed the

relevant regulations and guidance and is in line with the National Planning Policy

Framework. The council recognise the importance of producing a plan that is viable and

deliverable and has commissioned Troy Planning + Design and Three Dragons to assess

viability.

1.2 The testing undertaken uses a standard residual land value approach, using the Three

Dragons Toolkit for residential development and the Three Dragons Non- Residential

Model for non-residential development. The residual value of development (total value

less all development and policy costs, including planning obligations) is compared to a

land value benchmark and the scheme is said to be viable if the residual value exceeds

the benchmark. Note that the benchmark land value is an estimate of the lowest value

that a landowner may accept, and does not preclude the possibility that some schemes

may have enough value to pay more for land.

1.3 Colchester Borough Council is aligning the development of its Local Plan with Braintree

District Council and Tendring District Council (the Partner Authorities) to cover growth

in North Essex to 2033 and beyond.

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National Planning Context

1.4 The National Planning Policy Framework (NPPF) paragraph 173 sets out how the

Government expects viability to be considered in planning:

‘Pursuing sustainable development requires careful attention to viability and costs in plan-

making and decision-taking. Plans should be deliverable. Therefore, the sites and the scale

of development identified in the plan should not be subject to such a scale of obligations

and policy burdens that their ability to be developed viably is threatened. To ensure

viability, the costs of any requirements likely to be applied to development, such as

requirements for affordable housing, standards, infrastructure contributions or other

requirements should, when taking account of the normal cost of development and

mitigation, provide competitive returns to a willing land owner and willing developer to

enable the development to be deliverable.’1

1.5 The NPPF explicitly recognises the need to provide competitive returns to a willing land

owner and willing developer, and local planning authorities are to assess the ‘likely

cumulative impact’ of their proposed development standards and policies.

1.6 Planning Practice Guidance2 (PPG) provides further detail about how the NPPF should

be used. PPG contains general principles for understanding viability (which are relevant

to CIL viability) as well as specific CIL viability guidance3. It also notes that a range of

sector-led guidance is available 4 . In order to understand viability, a realistic

understanding of the costs and the value of development is required and direct

engagement with development sector may be helpful 5 . Evidence should be

proportionate to ensure plans are underpinned by a broad understanding of viability,

with further detail where viability may be marginal or for strategic sites with high

1 DCLG, 2012, NPPF Para 173

2 DCLG, Planning Practice Guidance

3 PPG Paragraph: 003 Reference ID: 10-003-20140306



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infrastructure requirements 6 . However not every site requires testing and site

typologies may be used to determine policy7. For private rented sector, self build and

older people’s housing, the specific scheme format and projected sales rates (where

appropriate) may be a factor in assessing viability8.

1.7 PPG requires that a buffer should be allowed and that current costs and values should

be used (except where known regulation/policy changes are to take place)9. On retail

and commercial development, broad assessment of value in line with industry practice

may be necessary 10 . Generally, values should be based on comparable, market

information, using average figures and informed by specific local evidence11. For an

area wide viability assessment, a broad assessment of costs is required, based on robust

evidence which is reflective of local market conditions. All development costs should be

taken into account, including infrastructure and policy costs as well as the standard

development costs12.

1.8 Developer returns should be proportionate to risk13. The return to the landowner will

need to provide an incentive for the land owner to sell in comparison with the other

options such as current use value or policy compliant alternative use value14.

1.9 Recent Ministerial guidance on affordable housing policy (28th November 2015) and

associated changes to PPG15 have made the following changes:









14 PPG Paragraph: 015 Reference ID: 10-015-20140306 15 PPG Paragraph: 031 Reference ID: 23b-031-20161116

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contributions should not be sought from developments of 10-units or less, and which have

a maximum combined gross floorspace of no more than 1000sqm

in designated rural areas, local planning authorities may choose to apply a lower

threshold of 5-units or less. No affordable housing or tariff-style contributions should then

be sought from these developments. In addition, in a rural area where the lower 5-unit or

less threshold is applied, affordable housing and tariff style contributions should be

sought from developments of between 6 and 10-units in the form of cash payments which

are commuted until after completion of units within the development.

1.10 For specific topics, the PPG provides information on the different types of policy

requirements that authorities may decide to implement through their Local Plans. This

provides greater clarity on how these requirements may affect the cost of development

and provides a starting point for how they should be taken into account. For example,

the PPG sets out optional technical standards for internal space standards, water

consumption and accessibility against which additional costs may be calculated16.

1.11 For other areas such as the implementation of Sustainable Drainage Systems (SUDs),

PPG sets out a clear approach to deliver schemes against the hierarchy provided by the

government’s non-statutory technical standards, so far as is reasonably practical17. The

costs of implementing the standards should not normally exceed the requirement to

meet building regulations, accepting that development and land value assumptions for

brownfield land should “clearly reflect the levels of mitigation and investment required to

bring sites back into use18”.




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Other Guidance on Viability Testing for Residential

Development

1.12 Guidance has been published to assist practitioners in undertaking viability studies for

policy making purposes – “Viability Testing Local Plans - Advice for planning practitioners”19.

The Foreword to the Advice for planning practitioners includes support from DCLG, the

LGA, the HBF, PINS and POS. PINS and the POS20 state that:

“The Planning Inspectorate and Planning Officers Society welcome this advice on viability

testing of Local Plans. The use of this approach will help enable local authorities to meet

their obligations under NPPF when their plan is examined.”

1.13 The approach to viability testing adopted for this study follows the principles set out in

the Advice. The Advice re-iterates that:

“The approach to assessing plan viability should recognise that it can only provide high

level assurance.”

1.14 The Advice also comments on how viability testing should deal with potential future

changes in market conditions and other costs and values and, in line with PPG, states

that:

“The most straightforward way to assess plan policies for the first five years is to work on

the basis of current costs and values”. (page 26)

But that:

“The one exception to the use of current costs and current values should be recognition of

significant national regulatory changes to be implemented………” (page 26)

19 The guide was published in June 2012 and is the work of the Local Housing Delivery Group, chaired by

Sir John Harman, which is a cross-industry group, supported by the Local Government Association and

the Home Builders Federation.

20 Acronyms for the following organisations - Department of Communities and Local Government (DCLG),

The Local Government Association (LGA), Environment and Housing Board (EHB), Home Builders

Federation (HBF), Planning Inspectorate (PINS), Planning Officers Society (POS)

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Local Planning Policy Context

1.15 The NPPF is clear that viability testing should take into account, ‘…the costs of any

requirements likely to be applied to development…’ (Para 173). Therefore, a planning policy

review has been undertaken – see Appendix II – Local Plan Policies.

1.16 Once adopted, the Local Plan will be the main planning document for Colchester

Borough Council. It will set out the overarching spatial strategy and development

principles for the area joint ‘Part 1’ strategy with Braintree District Council and Tendring

District Council.

1.17 This Study does not specifically take account of the policies from the combined ‘Part 1’

Local Plan, which is primarily concerned with setting the spatial strategy and

requirements for development as well as identifying allocations for three new Garden

Communities. The proposed Garden Communities have been subject to separate

viability testing.

1.18 The policies of the ‘Part 2’ Plan are fully assessed within this Viability Study. These give

effect to the spatial strategy and meeting the requirements for growth in the borough

as set out in the ‘Part 1’ Plan. This is achieved through the allocation of sites together

with more detailed policies for development management, standards and measures to

secure the levels of infrastructure required to support development. The Local Plan will

be used to help determine planning applications in the borough. The main elements of

the Local Plan are:

• Providing strategic objectives and vision for the borough

• Achieving the overarching strategy for the location of new development

• Deliver economic growth in response to new challenges and trends

• Identification of strategic development sites

• Identifying and providing for future infrastructure requirements

• Managing key environmental constraints and opportunities

• Include strategic policies for development control purposes and setting out the

standards that new development is expected to meet.

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1.19 The Local Plan includes a number of policies which can have an impact on the viability

of development. Impacts of policies are of four main types:

• Because they require the developer to make provision for a particular type of

development within their scheme (e.g. affordable housing, specialist housing for

older people);

• Because they require development to provide for planning obligations to ensure

its acceptability in planning terms (see ‘CIL and S106 requirements below’)

• Because they impact on the form of development and hence its costs e.g. in

meeting design or environmental standards; or

• Because they mean that an area within a development scheme has to be set

aside for a use that does not generate an income (e.g. in meeting an open space

requirement)

1.20 We have worked with the Council to analyse the policies of the Local Plan. This is

necessary to identify those which may add costs and/or reduce the anticipated revenue

from development. Appendix II provides a summary of each policy, potential impact on

viability and implications for viability testing or reflecting policy requirements within the

methodology for testing.

1.21 This is also important to inform the types of development that viability testing should

take into account based on the outputs the Local Plan supports – for example specialist

housing for older people or ‘Rural Exception Sites’ for affordable housing outside of

settlement limits.

1.22 Below, we highlight examples of policies which are likely to have an impact on viability:

• Affordable housing (see next section)

• Meeting policy targets for accessible and adaptable homes

• New dwellings in accordance with nationally described space standards

• Measures to restrict water consumption and improve water quality

• Transport infrastructure and public right of way improvements

• Provision of community facilities e.g. schools, healthcare

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• Ensuring provision of land and monies for open space and leisure facilities.

• Achieving the ‘BREEAM’ Standards from non-residential developments

DM8: Affordable housing

1.23 A key policy that affects development viability is DM8: Affordable Housing Provision. The

policy states that:

• A target of 30% of the total number of residential units on new development

within Colchester Borough should be affordable housing. Provision will normally

be sought on site.

• Contributions will be sought from all schemes comprising 11 or more dwellings,

in accordance with thresholds for such contributions set out in the PPG21.

• The policy seeks to operate a lower threshold for seeking contributions between

6 and 10 units in designated rural areas, where in accordance with national policy

the expectation would be in the form of financial payments commuted until after

completion of units

• Standalone new settlements by virtue of their size will be subject to separate

viability appraisals, including on affordable housing; however the starting point

should be 30% for affordable housing provision.

• Off-site provision or a financial contribution may be accepted where on-site

delivery is impractical. A viability appraisal will be required and will be

independently verified if applicants seek to demonstrate that requirements

cannot be achieved. The mix of units should reflect local need.

• The provision of Rural Exception Sites is supported, and may include a

proportion of market housing where information is submitted to demonstrate

that this is essential to cross-subsidise the delivery of affordable housing and

represents only the proportion necessary to achieve the significant provision of

21 PPG Paragraph: 031 Reference ID: 23b-031-20161116

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affordable housing as part of development. The number of affordable units and

total floorspace on a site should always be greater than the number of open

market units or floorspace, with actual numbers determined by local

circumstances.

1.24 In assessing viability, we have modelled the requirements for affordable housing as set

out in the policy, at a threshold of more than 10 dwellings (except in designated rural

areas), making specific assumptions about the type of affordable housing to be provided.

Details of the assumptions used are set out in the next chapter and appendix I. Scenario

testing has also been undertaken to demonstrate the financial assumptions that must

be adopted to deliver a notional, viable, Rural Exception Site.

CIL and S106 Requirements

1.25 Colchester Borough Council has not adopted a Community Infrastructure Levy (CIL) and

therefore this study has not taken such a levy into consideration. Neither is it designed

to provide evidence to support a CIL charging schedule. S106 contributions have

therefore not been scaled back (as would be the case if a CIL charge was in place) but

will nonetheless have to meet the three tests:

• Necessary to make the development acceptable in planning terms;

• Directly related to the development;

• Fairly and reasonably related in scale and kind to the development.

1.26 The testing assumptions set out in Chapter 2 detail the assumptions for future levels of

planning obligations that new developments will be expected to provide for (see

paragraph 2.17).

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Research Evidence

1.27 The research which underpins the Economic Viability Assessment includes:

• Analysis of information held by the authority, including the profile of land supply

identified in the Strategic Housing Land Availability Assessment and sites proposed

for allocation in the emerging Local Plan; a review of historic planning permissions;

and reviewing records of planning contributions;

• A stakeholder workshop was undertaken on 13 March 2017 and held jointly on behalf

of the three authorities of Braintree District Council along with Colchester Borough

Council and Tendring District Council. The session was attended by around 25

delegates, spanning the public and private sector and including representatives from

planning, housing and the development industry. Notes of the session are included

at Appendix III.

• Telephone interviews with Registered Providers operating in the borough;

• Follow up discussions with stakeholders and estate agents were used to validate

assumptions for land values and property prices, particularly for new-build stock;

• On-going dialogue with council officers, in-particular from planning and housing; and

• Analysis of publicly available data to identify the range of values and costs needed

for the viability assessment.

1.28 All the residential viability testing uses the Three Dragons Toolkit, adapted for

Colchester, to analyse scheme viability for residential development and the Three

Dragons bespoke model for the analysis of non-residential schemes.

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2 Viability Testing –

Residential Development Principles and Approach

2.1 The Advice for planning practitioners summarises viability as follows:

2.2 ‘An individual development can be said to be viable if, after taking account of all costs,

including central and local government policy and regulatory costs and the cost and

availability of development finance, the scheme provides a competitive return to the

developer to ensure that development takes place and generates a land value sufficient to

persuade the land owner to sell the land for the development proposed. If these conditions

are not met, a scheme will not be delivered.’22

2.3 As is standard practice,23 we have adopted a residual value approach to our analysis.

Residual value is the value of the completed development (known as the Gross

Development Value or GDV) less the development costs. The remainder is the residual

value and is available to pay for the land. The value of the scheme includes both the

22 P 14 Viability Testing Local Plans: Advice for Planning Practitioners Harman 2012

23 See page 25 of Viability Testing Local Plans: Advice for Planning Practitioners Harman 2012 – “We

recommend that the residual land value approach is taken when assessing the viability of plan-level policies

and further advice is provided below on the considerations that should be given to the assumptions and inputs

to a model of this type.”

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value of the market housing and affordable housing. Scheme costs include the costs of

building the development, plus professional fees, scheme finance and a return to the

developer as well as any planning obligations.

Figure 2.1 Residual Value Approach

2.4 To assess viability, the residual value generated by a scheme is compared with a

benchmark land value, which reflects a competitive return for a landowner.

Land Value Benchmarks

2.5 In terms of benchmark land values, Viability Testing Local Plans sets out a preferred

approach in the following extract from page 29:

2.6 Our mapping of prices and values has suggested two distinct market areas in Colchester

Borough: Tiptree & Rural and Central as indicated in figure 2.2 below. The map has been

Total development value (market and affordable)

Minus

Development costs (incl. build costs and return to developer)

=

Gross residual value

Minus

CIL + planning obligations (including AH)

=

Net residual value (available to pay for land)

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generated by house price data which, logically, is reflected in the corresponding land

values. Tiptree & Rural has higher values than Central.

Figure 2.2: Value Areas – Colchester Borough Council

2.7 We have looked at a range of methods to arrive at benchmark land values starting with

generic agricultural land value for the borough of £24K per hectare24 which, when

multiplied up by 10 – 20 times gives a greenfield land value of between £240,000 and

£480,000, giving an indication of values for large greenfield sites. In Colchester Borough

where the housing market is relatively buoyant we have tended towards the upper end

of this benchmark. On very large sites, such as the Garden Communities (which are not

considered in this study) land will clearly transact towards the lower end.25

24 DCLG 2015

25 See Homes and Communities Agency, 2010, Annex 1 (Transparent Viability Assumptions) p9 which

references “Benchmarks and evidence from planning appeals ….. For greenfield land … tend to be in a

range of 10 to 20 times agricultural value

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2.8 Information on which to base a suitable benchmark for smaller sites is to some extent

limited. Planning Practice Guidance26 explains that land values should:

• reflect emerging policy requirements and planning obligations and, where

applicable, any Community Infrastructure Levy charge;

• provide a competitive return to willing developers and land owners (including

equity resulting from those building their own homes); and

• be informed by comparable, market-based evidence wherever possible. Where

transacted bids are significantly above the market norm, they should not be

used as part of this exercise.

We have looked to a variety of sources from which we have been able to draw

information and make comparison thus making the ‘sense check’ identified in Viability

Testing Local Plans. Feedback from the consultation process described in the following

paragraph indicates that a benchmark of between £600,000 to £1,000,000 per hectare

is a realistic range to use for this study.

2.9 The information gathering and consultation was based upon a number of sources.

• The council’s previously commissioned CIL report 201527 which gave benchmark

land values of £1m for the higher value areas and £0.6m for the lower.

• Discussion with the council on previous known transactions.

• An internet search in March 2017 revealed only 1 transaction within the borough

at £1.85m ha with planning approval (nil S106).

• A DCLG28 value of £1.6m per unencumbered gross ha suggests a lower value

once obligations are taken into account. Modelling approximates the value of

obligations at around £0.9m per ha (at 35dph as assumed by DCLG) bringing the

DCLG value into the range of this study.

26 Paragraph: 014 Reference ID: 10-014-20140306

27 Para 4.3 updated review of evidence base CIL report October 2015 (BPS)

28 DCLG December 2015 https://www.gov.uk/government/publications/land-value-estimates-for-policy-

appraisal-2015

https://www.gov.uk/government/publications/land-value-estimates-for-policy-appraisal-2015

https://www.gov.uk/government/publications/land-value-estimates-for-policy-appraisal-2015

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• The development industry was consulted at a developer workshop where land

values of £1m and £0.5m were presented. Comments were limited but broadly

concurred with our findings; values were subsequently amended to £1m and

£0.6m following comments. Developers in attendance largely saw the value of

land in Colchester as aligned to that in Braintree.

• A survey of local agents29 confirmed that our values were about right.

2.10 We have therefore arrived at the benchmark land values given in figure 2.3 below:

Figure 2.3 Benchmark Land Values – per gross hectare

Colchester Small to medium

sites

Intermediate sites Large strategic

Over 20 ha (gross)

Tiptree & Rural £1m £0.75m £0.44m

Central £0.6m £0.5m £0.44m

30 These Assumptions exclude Garden Communities

2.11 The benchmark land values are an estimate of the lowest values that landowners may

accept and, where development is able to pay more, land will be transacted at higher

prices.

29 The consultant team engaged with the following agents, all of whom were based in Colchester and

confirmed knowledge of the study area, during March 2017: Haart (Colchester); Fenn Wright Land and

Property; Edward Lee Property; and Connells (Colchester)

30 For garden communities, land will transact at a lower value, see Paragraph 2.7 of report for further

information regarding the evidence base for this assumption.

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Testing approach and assumptions

2.12 Two types of testing have been undertaken:

• A notional 1 hectare site/tile (at a range of densities from 25dph to 40dph);

• A series of 42 case studies ranging in size from 1 to 1,100 dwellings. The case

studies are representative of development in Colchester, in particular the sites

identified in the Local Plan, and are informed by information provided by the

Council.

2.13 Key assumptions in relation to costs and revenues used in the analysis of residual values

for both the 1 hectare tile and case study sites can be found at Appendix I – Technical

Detail.

2.14 Both cost and revenue assumptions were included in the consultation process

described in para 1.27 above and amendments were made based on comments

received, where a basis could be provided for the amendment. Details can be found at

Appendix III – Stakeholder Workshops.

2.15 Revenue assumptions are based upon a thorough interrogation of Land Registry price

paid data taking into account new build sales and price per square metre. Prices fell into

one of 2 distinct value zones: ‘Central’ and ‘Tiptree & Rural’, with prices generally lower

in the Central area. Some comments received from stakeholders suggested that the

Central & Tiptree value are could be split further into rural district centres and rural

countryside but the published evidence did not support such a distinction, although it

is acknowledged that there will be some local variations across any value area. The value

zones are illustrated in figure 2.2 above. The results were sense checked with local

estate agents31.

31 The consultant team engaged with the following agents, all of whom were based in Colchester and

confirmed knowledge of the study area, during March 2017: Haart (Colchester); Fenn Wright Land and

Property; Edward Lee Property; and Connells (Colchester)

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2.16 The cost assumptions are based upon a mix of publicly available data, e.g. BCIS for build

costs, industry standard practice, and information provided by the council, for example

the value of S106 contributions.

2.17 Details of previously achieved S106 costs were provided by the council along with

costings of future anticipated collection which were triangulated with information

included in the council’s Infrastructure Delivery Plan (IDP). Based on this, a

representative cost of £6,000 per unit was concluded. For larger sites above 50 dwellings

this was increased to £10,000 per unit to account for the likelihood of contributions

towards higher education and other community infrastructure.

2.18 To take account of the possibility that some sites may incur particularly high

infrastructure or remediation costs, the specifics of which were unknown at the time of

testing, we have carried out a series of high cost scenarios on the larger sites as a

sensitivity test. In these sensitivity tests an additional £5,000 - £10,000 per dwelling was

added to the larger sites of 300 units or above. This is in addition to S106 costs referred

to in the previous paragraph and also to site opening up costs (to allow for on-site

infrastructure as detailed in Appendix I). For a 3 bed semi of 100 sq m at 35 dph this is

a total site infrastructure/s106 cost of just over £35,000 - £40,000 per unit for the high

cost scenarios.

2.19 Policy DM12 of the Local Plan seeks to meet the need of future residents as well as those

on the Housing Register for accessible & adaptable and wheelchair user housing under

Part M of the Building Regulations 201532. The associated additional cost has been

accounted for in our testing.

2.20 As the council had requested advice on what level of affordable housing would be viable

to meet the need assessed in the SHMA, affordable housing was modelled at both 35%

and 30% (Initial testing indicated it was not necessary to test at a lower level than this).

The affordable units were split 80/20 between rented and intermediate tenure as this

best meets the requirements of Registered Providers to develop affordable housing

32 https://www.gov.uk/government/publications/access-to-and-use-of-buildings-approved-document-m

https://www.gov.uk/government/publications/access-to-and-use-of-buildings-approved-document-m

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schemes that meet their financial criteria whilst addressing the high need for Affordable

Rented tenure identified in the SHMA. The Housing White Paper, currently out for

consultation, suggests a minimum requirement for 10% affordable home ownership on

sites over 10 units33. If this is adopted as policy it will mean that on smaller sites the

proportion of intermediate units may need to be increased but this will not adversely

affect the results of this study.

2.21 Dwelling mix for market housing was varied between densities, with the lower densities

providing a higher level of detached units and bungalows and the higher densities

including flats as well as a greater number of terraced or semi-detached units.

2.22 The mix for affordable housing was similar in all development sizes to reflect housing

need and past delivery. The affordable focus is on family units, largely 2 & 3 bed terraced

properties, as identified in the SHMA.

Case study sites over 0.2 ha (around 7 dwellings) were assumed to have a net to gross

ratio of around 90% to take account of any open space and any on-site infrastructure

provision, in line with the green space requirement. This increased to 80% at 2ha and

65% at 8ha. A full set of assumptions is provided in Appendix I - Technical Appendix.

33 Para 4.17 Fixing our Broken Housing Market (Housing White Paper) 7/2/17

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3 Residential Viability

Analysis – Notional 1

Hectare Site Testing Results

3.1 The results of the 1ha tiles are shown below. Each value area has been considered

separately and has been tested at 25, 30, 35 & 40 dwellings per hectare (dph). The full

set of results are shown in table form at appendix IV.

Notional 1 hectare scheme – Tiptree & Rural

3.2 Testing in the Tiptree & Rural value area showed a strong market with sites financially

viable at all densities. Affordable housing was modelled at 30% and 35% and both levels

produced a positive result. At 35% affordable housing scheme values ranged from

£0.5m to £0.738m per hectare above benchmark land value and at 30% affordable

housing from £0.661m to £0.924m. The most viable sites were at 35 dph.

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Main benchmark land value = £1m per gross hectare

Notional 1 hectare scheme – Central

3.3 Results from the Central value area also demonstrate a strong market with good general

viability. At 30% affordable housing the scheme value remained above benchmark land

value by between £0.573m and £0.754m per hectare and at 35% affordable housing by

between £0.442m and £0.604m. The most viable density was 35 dph.

-

200,000

400,000

600,000

800,000

1,000,000

25dph 30dph 35dph 40dph

Figure 3.1: Residual Value less benchmark land value per ha

Colchester - Tiptree & Rural - AH 30% and 35%

30% AH 35% AH

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Main benchmark land value £0.6m per gross hectare

Notional 1 hectare scheme – All Schemes at Sensitivity

Benchmarks

3.4 All schemes were evaluated again at a higher, sensitivity, benchmark land value. This

takes into account that sites of this nature and size are often the easiest to deliver as

they are straightforward in terms of shape or remediation and are not encumbered by

significant net to gross ratios. It also allows for any pockets of higher value/prices within

each area. Apart from land value, all other factors remain the same.

3.5 Figures 3.3a and 3.3b below demonstrate that the 1 hectare sites remain viable when

the main benchmark land value is increased by 20%.

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

25dph 30dph 35dph 40 dph

Figure 3.2: Residual Value less benchmark land value per ha

Colchester - Central - AH 30% and 35%

30% AH 35% AH

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Figure 3.3a: Tiptree & Rural (sensitivity)

Benchmark land value of £1m + 20% = sensitivity benchmark land value of £1.2m per hectare

Figure 3.3b: Central (sensitivity)

Benchmark land value of £0.6m + 20% = sensitivity benchmark land value of £0.72m per hectare

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Notional 1 hectare scheme – Overview

3.6 The testing undertaken for the notional 1 ha sites provides a broad overview of the

viability of Colchester Borough Council’s Local Plan.

3.7 At a 1 hectare site level a range of policy compliant residential densities can be delivered

with a residual value in excess of both the main and sensitivity benchmark land values.

3.8 Sites were viable at both levels of affordable housing tested – 35% which is the need

identified in the SHMA and 30% which is equitable with the modelling of the Garden

Communities.

3.9 In all value areas the 35dph scenario is the most viable, although at 25; 30 & 40 dph the

residual values are comfortably in excess of the main and the sensitivity benchmark

land value.

3.10 The results of the 1 ha tiles give an overview of good general development viability at a

range of densities in all value areas.

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4 Residential Viability

Analysis – Case Study Sites Case study characteristics

4.1 In conjunction with the Council we have identified 50 case studies which reflect typical

sites likely to be brought forward in the borough. The case studies vary in size from 1 to

1,100 dwellings and in density from 25 to 100 dwellings per hectare. There are 15 basic

scenarios which were tested in the both value areas, with sensitivity testing around

affordable housing policy, density, infrastructure and site costs.

4.2 We have divided the case studies into three main groups against the different

benchmark land value site sizes: small - medium case studies of less than 2.5 ha

(approximately 1 - 70 dwellings); intermediate case studies for schemes between 75 and

300 dwellings; and larger case studies of over 20 ha (600 or more dwellings). We have

dealt separately with the rural exception site (10 dwellings) and the sheltered / extra

care schemes. These are all reported on below. The key characteristics of the case

studies are shown at the outset of each sub-section under which they are reported; all

other assumptions are the same as for the 1ha tiles. Appendix I provides details of the

assumptions used for the testing and Appendix IV contains the results in tabular format.

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Small/Medium Case Studies (Case Studies 1 to 8)

4.3 This section of the report examines the results from the testing of the small – medium

case studies; those sites under 2.5 ha which will attract the highest land values. First, we

look separately at the smallest case studies, below the affordable housing threshold,

and then at small to medium studies which will need to provide affordable housing.

Small sites below 11 units

Case Study

Ref No of Dwgs %AH Density (dph)

Net Area (ha)

Gross area (ha)

Net to Gross %

Opening up costs for strategic

Infrastructure (£ per net ha)

C1 1 dwelling 0% 40 0.025 0.025 100% Nil

C2 3 dwellings 0% 40 0.075 0.075 100% Nil

C3 7 dwellings 0% 35 0.200 0.222 90% Nil

C3 7 dwellings 30% 35 0.200 0.222 90% Nil

Figure 4.1 Characteristics of Case Studies for fewer than 11 Units

4.4 The smallest case studies comprising schemes of 1, 3 and 7 units help consider the

impact of Local Plan policies on sites, below the affordable housing threshold, that will

come forward during the plan period. Smaller schemes, especially those of 3 units or

fewer will often incur higher costs which may be ameliorated by higher selling prices.

For single unit schemes, land value may in practice be a less relevant marker because

schemes are often small infill sites which attract high prices and values or may be on

land already in possession of the owner such as a garden. For these case studies, we

assume that development occurs within a year. We follow a similar approach to that

used with the 1 hectare notional scheme, with the benchmark land value deducted from

the residual value.

4.5 The results of the viability testing for the small case studies, in both value areas, are set

out in figure 4.2 below.

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4.6 Both the 3-unit scheme and the 7-unit scheme show a surplus in excess of £1m above

the benchmark land value, in the Tiptree & Rural area it is above £1.5m. At 1 dwelling a

small scheme is not shown as viable with a deficit of -£0.92m to benchmark land value

in the Tiptree & Rural area and -£1.52m in the Central area. This is generally a reflection

of the higher costs incurred on an individual unit without the benefit of the value gained

by additional units. Single dwellings may be individual one-off schemes not necessarily

brought forward for profit.

4.7 We also tested the 7-unit scheme to demonstrate the impact of the council’s policy to

collect commuted sums on developments of 6-10 units in those areas designated AONB.

On a gross value per hectare after deduction for benchmark land value the schemes

produced values of £729,730 in the Tiptree & Rural area and £616,216 in the Central

area. The results are shown in Figure 4.3 below, on a per scheme basis, giving the

residual value on a scheme with all market housing and on a scheme with 30%

affordable housing. Both scenarios produce viable results. The third column shows the

difference between the two values and is the amount available for a commuted sum,

taking into account both the cost of providing the affordable units and the value gained

by replacing them with open market housing.

-£2,000,000

-£1,500,000

-£1,000,000

-£500,000

£0

£500,000

£1,000,000

£1,500,000

£2,000,000

£2,500,000

C1 - 1 unit C2 - 3 units C3 - 7 units

Figure 4.2: Small Case Studies - residual value less benchmark land value per hectare

Tiptree & Rural Central

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Small – Medium Sites

Case Study Ref No of Dwgs %AH

Density (dph)

Net Area (ha)

Gross area (ha)

Net to Gross

%

S106 Contributions

(£/dwelling)

Opening up costs for strategic Infrastructure (£ per net ha)

C5 11 dwellings 30% 35 0.315 0.350 90% £6,000 Nil

C5A 11 dwellings 35% 35 0.315 0.350 90% £6,000 Nil

C6 15 dwellings 30% 35 0.429 0.477 90% £6,000 Nil

C6A 15 dwellings 30% 35 0.429 0.477 90% £10,000 Nil

C6B 15 dwellings 30% 25 0.600 0.666 90% £6,000 Nil

C6C 15 dwellings 30% 25 0.600 0.666 90% £10,000 Nil

C7 50 dwellings 30% 35 1.429 1.571 90% £10,000 £50,000

C8A 100 dwellings 30% 100 1.000 1.111 90% £10,000

£100,000

C8 60 dwellings 30% 60 1.000 1.111 90% £10,000

£50,000

Figure 4.4 Characteristics of Case Studies for Small and Medium Sites

4.8 These small - medium case studies are representative of sites below 2.5 ha allocated to

deliver residential growth during the plan period. They are above the 11-dwelling

threshold for affordable housing delivery and will also be covered by policies in respect

of accessibility & adaptability as well as open space. Sites over 50 units may be subject

to higher S106 costs and this is reflected in our modelling. We have also tested the 15-

unit scheme with additional S106 as a sensitivity scenario. The case studies have been

modelled at 35 dph, except for case studies C6B & C (15 units) which are modelled at 25

£215,000£159,000

£0

£100,000

£200,000

£300,000

£400,000

£500,000

£600,000

£700,000


£ p

er s

chem

e

Figure 4.3: Small Site (7 units) showing impact of Affordable Housing Policy in AONB

All Market Housing with 30% affordable Available for commuted sum

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dph. Affordable housing is modelled at 30%. The modelling includes 2 flatted schemes,

of 60 and 100 units, which have a gross land take of 1.11ha per scheme.

Tiptree & Rural Value Area

4.9 In the Tiptree & Rural value area all small-medium residential case studies are viable at

residual value less benchmark land value, with the exception of the 2 flatted schemes.

The highest values are achieved for the 11-unit scheme and the 15-unit scheme at 35

dph at £0.745m and £0.740m respectively, per hectare, after deduction for land value.

At lower density and higher S106, the 15-unit scheme is still viable (not shown in the

chart, the 11-unit scheme was also modelled with a higher, 35%, affordable housing

level and this too was viable with an excess of £0.58m per hectare over benchmark land

value).

4.10 The two flatted schemes do not demonstrate viable sites. The high negative values

indicate that this arises from a local combination of costs and values rather than from

the cost of meeting policy requirements. It is likely that, in the Tiptree & Rural area, such

schemes would struggle to deliver, even at a reduced land value, in the present financial

climate.

-£2,000,000

-£1,500,000

-£1,000,000

-£500,000

£0

£500,000

£1,000,000

C5 - 11units

C6 - 15units

C6A - 15units

(higherS106)

C6B - 15unitslower

density

C6C - 15unitslower

density(higherS106)

C7 - 50units

C8 - 60units(flats)

C8A - 100units -flats

Fig 4.5: Small-Medium Case Studies Tiptree & Rural -residual value less benchmark land value per ha

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Central Value Area

4.11 In the Central value area, again, all small-medium residential schemes produce viable

results with the exception of the flatted schemes, with surpluses over benchmark land

value ranging from £0.436m to £0.634m. The 11 and 15 unit schemes at 35 dph produce

the highest surplus with the 15-unit scheme achieving viability with a lower density and

higher S106. (Not shown in the chart, the 11-unit scheme was also modelled with 35%

affordable housing and this too was viable with an excess of £0.5m per hectare over

benchmark land value).

4.12 Both 100 unit and the 60 unit flatted schemes are not viable. The high negative values

indicate that this arises from a local combination of costs and values rather than from

the cost of meeting policy requirements. It is likely that, in the Central area, such

schemes could struggle to deliver in the short term even at a reduced land value. When

modelled with a 20% increase in selling prices (but no corresponding increase in costs),

the 60-unit flatted scheme was viable at current land values.

-£1,500,000

-£1,000,000

-£500,000

£0

£500,000

£1,000,000

C5 - 11units

C6 - 15units

C6A - 15units

(higherS106)

C6B - 15unitslower

density

C6C - 15unitslower

density(higherS106)

C7 - 50units

C8 - 60units(flats)

C8A - 100units -flats

Figure 4.6: Small-Medium Case Studies Central -residual value less benchmark land value per hectare

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Intermediate Case Studies (Case Studies 9 – 11)


Density (dph)

Net Area (ha)

Gross area (ha)

Net to Gross %

S106 Contributions

(£/dwelling)



C9 75 dwellings

30% 35 2.143 2.678 80% £10,000 £50,000

C10 125 dwellings

30% 40 3.125 3.900 80% £10,000 £100,000

C11 300 dwellings

30% 35 8.571 13.187 65% £10,000 £150,000

C11 300 dwellings

30% 35 8.571 13.187 65% £15,000 £150,000

Figure 4.7 Characteristics of Intermediate Case Studies

4.13 The intermediate case studies are indicative of sites sized above 2.5 ha which will deliver

residential growth during the plan period. Opening up costs are higher and net to gross

ratios lower than for the small to medium sites. Case study 11 (300 dwellings) has also

been modelled at a ‘higher cost scenario’ to allow for additional infrastructure or site

remediation costs that may be incurred on larger site sizes. These are on top of the

already higher costs modelled in the ‘straightforward scenario’, details of which can be

found in Appendix I.

4.14 The results of the case study modelling in both value areas are shown in the charts

below.

£0

£100,000

£200,000

£300,000

£400,000

£500,000

£600,000

C9 - 75 units C10 - 125 units C11 - 300 units C11 - 300 units -high cost

Figure 4.8: Intermediate Case Studies - residual value less benchmark land value per hectare


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4.15 All intermediate case studies are viable in both value areas and this includes the 300-

unit scheme at a higher cost scenario. In the Tiptree & Rural area the 125-unit scheme

is most viable, producing a surplus of £0.53m above benchmark land value and in the

Central area the 75-unit scheme is most viable at £0.476 above benchmark land value.

4.16 The 300-unit scheme results in a lower surplus than for the 2 smaller studies, indicative

of the higher costs associated with developing a larger scheme. When costs are

increased further to account for sites where there may be higher infrastructure or

remediation costs, this scheme is still viable albeit with a small surplus over land value

(£83,135 in Tiptree & Rural and £29,600 in Central areas).

Larger Case Studies 600 & 1100 dwellings (Case Studies

12 to 13)


Density (dph)

Net Area (ha)

Gross area (ha)

Net to Gross %

S106 Contributions

(£/dwelling)



C12 600 dwellings 30% 35 17.143 26.374 65% £10,000 £200,000

C12 600 dwellings 30% 35 17.143 26.374 65% £20,000 £200,000

C12A 600 dwellings 30% 30 20.000 30.769 65% £10,000 £200,000

C12A 600 dwellings 30% 30 20.000 30.769 65% £20,000 £200,000

C13 1100 dwellings 30% 35 31.429 48.352 65% £10,000 £200,000

C13 1100 dwellings 30% 35 31.429 48.352 65% £20,000 £200,000

Figure 4.9 Characteristics of Larger Case Studies

4.17 This section of the report deals with large case studies on sites above 20 gross ha. They

include additional site and infrastructure costs as well as the lower land values likely to

be achieved on schemes of this size. There is also a ‘high cost scenario’ which considers

the impact of further costs for additional infrastructure or site remediation (£10,000 per

plot) on top of the additional costs already allowed for in the ‘straightforward scenario’.

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Tiptree & Rural Area

4.18 The results for the Tiptree & Rural large case studies are shown in the chart below.

4.19 In the Tiptree & Rural area all the large case studies show a per hectare surplus over

benchmark land value, including schemes modelled at a high cost scenario. Case study

C12 (600 dwellings) produces the highest surplus followed by C13 (1,100 dwellings); both

these studies were modelled at 35 dph. At a lower density (30 dph) case study 12A still

give a surplus but is less viable than the same scheme at 35dph.

£0

£50,000

£100,000

£150,000

£200,000

£250,000

£300,000

£350,000

£400,000

£450,000

£500,000

C12 - 600 units C12A - 600 units lowerdensity

C13 - 1,100 units

Figure 4.10: Large Case Studies Tiptree & Rural -residual value less benchmark land value per ha

Tiptree & Rural Tiptree & Rural - high cost scenario

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Central Value Area

4.20 The chart below shows the results for large case studies in the Central area.

4.21 In the Central area, the large case studies produce viable results when the standard

costs normally anticipated to occur on such development are applied. At the higher cost

scenario the case studies still produce a positive residual value but this is less than the

benchmark for these sites, giving a marginal deficit ranging from -£4,666 to -£61,143 per

gross hectare.

Rural Exception Site (case study 4)

4.22 A 10-dwelling rural exception site was modelled to ascertain what, if any, market

housing may be required to ensure viability. Tenure mix on rural exception sites will

normally be determined by locally assessed need, but as this is a notional site we have

assumed a mix that is typical whilst also considering what is needed to achieve viability.

-£100,000

-£50,000

£0

£50,000

£100,000

£150,000

£200,000

C12 - 600 units C12A - 600 units lowerdensity

C13 - 1,100 units

Figure 4.11: Large Case Studies Central - residual value less benchmark land value per ha

Central Central - high cost scenario

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Figure 4.12: Viable mix on Rural Exception Site – showing 10 dwelling scheme residual

value

Tenure: 30% market /

40% Affordable Rent /

20% shared ownership

Tenure: 20% market /

50% Affordable Rent /

20% shared ownership

Tiptree & Rural £252,000 £134,000

Central £128,000 £32,000

4.23 The results indicate that between 20% and 30% of rural exception sites would need to

be dwellings for market sale in order to achieve enough value to pay for land. In arriving

at this figure we have assumed there is no HCA grant available.

• In the Tiptree & Rural area, residual value (i.e. available for land purchase) was

£252,000 when 30% of the site was for private sale and £134,000 at 20% market

sale - £25,200 - £13,400 per plot. Based on our conversations with RPs, the lower

level of market homes would be sufficient in most instances.

• In the Central area, residual value for the site with 30% market homes was

£128,000 or £12,800 per plot. At a 20% market level the residual value is unlikely

to be sufficient to purchase land unless that land was gifted.

Sheltered & Extra Care Sites (case studies 14 & 15)

4.24 Sheltered and extra care schemes were modelled in both value areas.

£0

£200,000

£400,000

£600,000

£800,000

£1,000,000

£1,200,000

£1,400,000

£1,600,000

£1,800,000

Sheltered Extra Care

Figure 4.13: Older Person's Housing - residual value less benchmark land value per ha


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4.25 Sheltered and extra care schemes produced viable results in both value areas. Sheltered

housing gave a surplus over benchmark land value of £1.6m in the Tiptree & Rural area

and £1.5m in the Central area. For extra care this was £1m and £0.698m respectively.

Both schemes were modelled with 30% affordable housing. However, we would assume

that extra care housing would be classed as C2 and hence relieved from the affordable

housing obligation.

Case Studies – Overview

4.26 The case studies modelled in this viability study were identified with the council as the

best representation of sites expected to come forward in the delivery of the Local Plan.

They include full allowance of the costs of policies contained therein. The case studies

demonstrate good general viability of the plan policies and schemes allocated for

residential delivery.

4.27 Plan policies for affordable housing at 30% and additional costs for accessible housing,

Part M of Building Regulations (2015), are supported by the testing.

4.28 The main exception to good viability are the flatted schemes which in both areas show

schemes that are likely to struggle to deliver at current costs and values. Over time, the

likelihood that values will rise above costs could make these schemes more deliverable,

especially in the Central area, but may still require some relaxation on plan policies.

4.29 The large sites of 600 and 1100 dwellings have produced viable results in both value

areas taking into account the additional costs associated with larger developments. A

sensitivity ‘high costs scenario’ has shown that these schemes could bear further

infrastructure and/or remediation costs if necessary. However in the Central area the

sensitivity test produced results in deficit marginally below benchmark land value. In

these circumstances, there is room for land value to flex to take account of this and/or

that economies of scale would mean that a large developer could achieve lower building

costs.

4.30 All other schemes of 3 dwellings or above have produced positive results in viability

modelling and indicate that the Local Plan is deliverable.

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5 Non-residential

Development Introduction

5.1 This section of the report provides viability analysis of the non-residential development

planned to come forward under the new local plan. There will also be non-residential

development in the Garden Communities which is covered in a separate viability study.

5.2 The Pre-submission Local Plan notes that B class development is planned to come

forward on three Strategic Employment Zones (North Colchester, and particularly

Stanway and Knowledge Gateway) as well as employment in the Local Economic Areas

across the Borough.

5.3 Retail growth is proposed for the town centre as well as other locations such as other

mixed use locations and retail parks34. Leisure uses are planned to come forward,

including in town centre locations to support the current retail provision and the

Northern Gateway.

34 E.g. Tollgate, Turner Rise and Peartree Road

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5.4 The University of Essex has plans to grow from c.18,000 students in 2018 to 25,000

students by the end of the plan period. This will generate a need for further student

accommodation, with as many students as possible accommodated on campus.

Case Study and Testing Assumptions

5.5 The viability testing responds to the planned development by using the following case

studies:

• Town centre offices

• Business park offices

• Industrial/warehouse uses

• Town centre comparison retail

• Retail park comparison retail

• Small convenience retail

• Supermarket

• Hotel

• Mixed Leisure

• Care Home

• Student accommodation

5.6 The characteristics for each case study are set out in Figure 5.1 below.

5.7 Build costs are drawn from BCIS, using median values rebased to this location. Build

costs are just under the national average. Revenues have been based on transactions

listed by Co-Star Suite 35 (lettings and investments), supplemented by market

commentaries36. For office and industrial values, we have been advised by the Council,

which has been involved in developing and renting its own premises. For the other uses,

where possible we have based our values on local data but for some uses data had been

drawn from analogous developments in other areas (some retail, care homes, leisure)

35 CoStar Suite is a national database which offers a full market inventory of properties and spaces,

available as well as fully leased, searchable by market and submarket

36 CBR, Savills, Knight Frank, Focus

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in order to broaden the base for the estimates used here. Where there is a range of

examples we have focussed on quality provision of a standard likely to be attractive to

institutional investors.

5.8 Non-residential development in Colchester is encouraged to meet the BREEAM ‘Very

Good’ standard (Policy DM25). It is likely that this will be a commercial decision although

it is noted that if the standard is part of the original building design (rather than bolted

on at a late stage) then costs of meting BREEAM ‘Very Good’ are relatively small uplifts

on build costs (between 0.2% and 0.04%37). Therefore, we have not made any specific

allowances in the modelling.

Retail Values

5.9 Retail case studies include convenience38 and comparison, in and out of town centre.

The main locations with data available for high street comparison retail values are within

Colchester town centre. For out of centre comparison retailing (retail warehouses)

values are driven by the strength of the operator covenant and we have used data from

a broader area across the east of England.

5.10 In relation to convenience retail we note that in the past leases to the main supermarket

operators have commanded a premium with investment institutions, although there

has been a structural shift with the historic pattern of developing large stores now

replaced with development of smaller supermarket formats (as used by both discount

and premium convenience operators) and greater provision of small format stores,

often within the Sunday trading threshold39 (280 sq m display floor area), also often in

existing floorspace. These changes reflect the alterations in shopping habits. Although

there are some small regional variations on convenience retail values, they are

37 http://www.steelconstruction.info/Target_Zero#BREEAM_results

38 Convenience retailing is defined as the provision of everyday essential items, including food, drinks,

newspapers/magazines and confectionery; and within this larger stores provide the range required for

weekly shops and smaller stores provide more of a ‘top-up’ function. Comparison retail relates to other

consumer goods.

39 Sunday Trading Act 1994

http://www.steelconstruction.info/Target_Zero#BREEAM_results

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reasonably standard across the country with investors focusing primarily on the

strength of the operator covenant and security of income. As a result, it is reasonable

to use a broad geographical evidence base for convenience retail.

Office Values and Industrial and Warehouse Values

5.11 We have used values from the Council, which has been involved in developing and

letting premises. The values supplied by the Council have been at the upper end of the

spread of market data and reflect their efforts to develop the economy and the

commercial property market.

Hotel, Leisure and Food and Beverage Values

5.12 Nationally, there has been significant growth in the provision of budget hotels40, with

relatively few full-service hotels outside the major conurbations. The most likely hotel

development is a budget hotel from a limited number of national hotel operators. We

have used data from across a wide area to come to a view about the values these types

of hotel command.

5.13 For leisure, we have used values for cinemas, using data drawn from a broad area. Food

and beverage values have been estimated using local data.

Care Homes

5.14 Care home values have been estimated using data drawn from market commentaries

and trade press news relating to care home sales, some of which are portfolios of care

homes. This data which is drawn from across the UK and provides information on a

values per room basis. We have excluded specialist care homes where possible as while

these can have higher values, they will also have higher development costs.

40 The British Hospitality Association Trends and Developments Report 2012 indicates that budget hotels

are defined as a property without an extensive food and beverage operation, with limited en-suite and

in-room facilities (limited availability of such items as hair dryers, toiletries, etc.), low staffing and service

levels and a price markedly below that of a full service hotel.

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Student Accommodation

5.15 The purpose-built student accommodation sector has evolved into a mature investment

opportunity. Student numbers have increased and whilst the higher student fees did

affect the market, it has seemingly recovered, especially in those areas that attract

higher levels of overseas students. Whilst Colchester has not had the level of student

accommodation development of other university locations it nonetheless still has

potential for future growth. In terms of evidence on values we draw from across a

broad area as data is more limited in this market. Experience elsewhere has shown that

the best values for student accommodation are when the developments well located

relative to the university. As it is anticipated that the proposed new student

accommodation will be on or adjacent to the campus we have used higher than average

values per room and it should be noted that values may be lower in less attractive

locations.

Land Values for Non-Residential Development

5.16 Benchmark land values are an estimate of the lowest value that land may be released

for development as opposed to the highest values seen in market transactions. The

benchmark land values have been developed based on existing use values, with a

premium where the use is expected to change. WE have used the DCLG/VOA industrial

land value41 as a starting point, with a 20% premium where this may be used for a non-

B class use. For retail uses we have used the higher residential benchmark as this may

be an alternative use). The exception is the higher value town centre comparison retail

where we have assumed that the site will have an existing retail use but with lower

values and less floorspace. Here we have used this as the basis for generating value

estimates along with an allowance for demolition and associated costs42.

41 DCLG, 2015, Land value estimates for policy appraisal

42 We used a 100 sq m retail unit on two floors with 50% site coverage, with rents from the lower end of

the range recorded and weaker yield; along with an allowance for demolition and a 20% incentive for the

landowner.

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Table 5.1 - Benchmark land values

Type £ per gross

hectare

Prime town centre retail Site EUV

Convenience and other comparison retail, food &

drink

£1.0m

Budget hotels, care homes, leisure £0.81m

Office, industrial and warehouse £0.675m

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Figure 5.2 - Case-study characteristics

Out of centre

offices

Town

centre

offices

Industrial/

warehouse

units

Warehouse/

industrial

units

Floorspace sqm 1,500 2,000 1,600 5,000

Storeys 2 4 1 1

Site coverage 40% 75% 40% 40%

Rent/sqm £161 £188 £70 £70

Yield 7.00% 6.75% 6.75% 6.75%

Purchaser costs % GDV 5.80 5.80 5.80 5.80

Build costs/sqm including water

efficiency £1,273 £1,528 £795 £510

External works % of base build costs 10% 10% 10% 10%

Professional fees 10.00% 12.00% 12.00% 12.00%

Sales and letting costs % of GDV 3% 3% 3% 3%

Allowance for s106 (not covered by

CIL) £20,000 £0 £20,000 £50,000

Finance costs 6.0% 6.0% 6.0% 6.0%

Build and void period (months) 22 26 20 32

Developer return % GDV 20% 20% 20% 20%

SDLT & agent fees/sqm (if viable) £0 £0 £0 £0

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Figure 5.2 (continued) - Case-study characteristics

Prime town

centre

comparison

shops

Out of

centre

comparison

shops

Small

convenience

store

Mid

convenience

store Supermarket

Floorspace sqm 200 1,000 300 900 2,500

Storeys 2 1 1 1 1

Site coverage 80% 40% 65% 55% 40%

Rent/sqm £292 £157 £208 £177 £194

Yield 7.10% 6.60% 6.70% 6.20% 5.40%

Purchaser costs % GDV 5.80 5.80 5.80 5.80 5.80

Build costs/sqm £998 £690 £1,213 £1,213 £1,558

External works % of base

build costs 10% 10% 10% 10% 10%

Professional fees 12.00% 10.00% 12.00% 10.00% 10.00%

Sales and letting costs % of

GDV 3% 3% 3% 3% 3%

Allowance for s106 £0 £100,000 £0 £100,000 £100,000

Finance costs 6.0% 6.0% 6.0% 6.0% 6.0%

Build and void period

(months) 24 26 6 11 15

Developer return % GDV 20% 20% 20% 20% 20%

SDLT & agent fees/sqm (if

viable)

£49.22 £30.09 £14.19 £9.61 £24.30

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Budget hotel

Care

home

Student

accommodation

Floorspace sqm 2,450 3,000 5,565

Storeys 3 2 4

Site coverage 50% 40% 75%

Capital value per room £80,000 £95,000 £105,000

Purchaser costs % GDV 5.80 5.80 5.80

Build costs/sqm £1,123 £1,396 £1,618

External works % of base build costs 10% 10% 10%

Professional fees 12% 12% 12.00%

Sales and letting costs % of GDV 3% 3% 3%

Allowance for s106 £10,000 £75,000 £0

Finance costs 6.0% 6.0% 6.0%

Build and void period (months) 16 12 18

Developer return % GDV 20% 20% 20%

SDLT & agent fees/sqm (if viable) £19.50 £0 £0

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Leisure

development

Floorspace sqm 3,800

Storeys 2

Site coverage 80%

Rent/sqm £161

Yield 6.60%

Purchaser costs % GDV 5.80

Build costs/sqm £1,333

External works % of base build costs 10%

Professional fees 12.00%

Sales and letting costs % of GDV 3%

Allowance for s106 £20,000

Finance costs 6.0%

Build and void period (months) 12

Developer return % GDV 20%

SDLT & agent fees/sqm (if viable) £0

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Summary Viability Assessments

5.17 The tables below summarise the results from the detailed assessments for each non-

residential development type. They provide the following information:

• Net value per square metre.

• Net costs per square metre - including an allowance for land cost and s106 to

deal with site specific issues (e.g. On-site highways, travel plan etc. to make

development acceptable).

• Residual value per sq m (i.e. Value less costs).

• The land value benchmark for that use - presented £s per sq m of development

to take into account differences in site coverage and the number of storeys for

the notional developments.

• The viability headroom – for uses that are viable, this is the residual value over

and above the benchmark land value.

5.18 It is important to note that the analysis considers development that might be built for

subsequent sale or rent to a commercial tenant. However, there will also be design and

build development that is undertaken for specific commercial operators, either as

owners or pre-lets. In these circumstances, the economics of the development relate to

the profitability of the enterprise accommodated within the buildings rather than the

market value of the buildings.

5.19 Public sector economic development priorities may also result in funding being used to

deliver some forms of development or provide infrastructure that reduces the cost/risk

of private sector development. This might include making use of local authorities’ ability

to borrow cheaply or use capital budgets to create income earning assets, as well as

programmes such as the South East LEP’s Growth Deal which plans to invest over £100m

2017-20.

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B-Class Uses – Offices, industrial and warehouses

5.20 The viability assessments indicate that all of these B class uses produce a negative

residual value. The lack of viability for B class uses is common across many areas of the

country.

Figure 5.3 - Offices

Out of centre offices Town centre offices

Value per sq m £2,071 £2,506

Costs per sq m £2,210 £2,717

Residual per sq m -£139 -£212

Land benchmark per sq m £84 £23

Viability 'headroom' per sq

m -£224 -£234

Figure 5.4 - Industrial and Warehouses

Industrial units Warehouses

Value per sq m £931 £931

Costs per sq m £1,316 £958

Residual per sq m -£384 -£27

Land benchmark per sq m £169 £169

Viability 'headroom' per sq

m -£553 -£196

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Retail Uses

5.21 The viability of retail development will depend primarily on occupier demand and the

type of retail being promoted. For this reason, we have tested different types of retail

provision. All of the convenience retail uses tested were viable, with the small stores

having the strongest viability.

Figure 5.5 - Convenience Retail and Supermarkets

Small

convenience

store

Mid

convenience

store

Supermarket

Value per sq m £2,788 £2,563 £3,226

Costs per sq m £2,197 £2,269 £2,843

Residual per sq m £590 £294 £383

Land benchmark per sq m £154 £182 £250

Viability 'headroom' per

sq m £437 £112 £133

5.22 Speculative town centre development is marginally viable, although in the case of the

prime town centre retail this is sensitive to the site value as the case study does produce

a positive residual value. We have tested against a site with less valuable retail uses but

if sites with a lower existing use value were available, it may be possible for this form of

development to be more viable. Out of centre retail warehouses are viable.

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Figure 5.6 - Town Centre and Out-of-Centre Comparison Retail

Prime town

centre

comparison shops

Out of centre

comparison

shops

Value per sq m £3,693 £2,136

Costs per sq m £2,289 £1,586

Residual per sq m £1,404 £550

Land benchmark per sq m £1,396 £250


sq m £8 £300

Other Tested Uses

5.23 The other uses tested include hotels, mixed leisure developments and care homes. Of

these uses, only budget hotels are viable, while student accommodation is marginal.

We note that it would only require a 2% increase in values for student accommodation

to become viable and given that this is within the variance in the data used to estimate

the values it seem likely that this type of development will be viable, particularly if

developed on campus where the land may be obtained at below commercial rates. This

is confirmed by evidence of student accommodation delivery on the campus and recent

delivery/schemes in the pipeline elsewhere in the Borough, which demonstrates that

this type of development has been viable recently.

5.24 Care home development often has weaker viability and the findings in Colchester are

similar to these generally seen elsewhere. Issues affecting care home viability include

pressures on social care budgets and the impact on revenues, as well as the quality

standards required for these schemes.

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Figure 5.7 - Other Accommodation, Leisure and Care Uses

Budget

hotel

Student

accommodation Leisure

Care

home

Value per sq m £2,160 £2,836 £2,158 £1,796

Costs per sq m £2,043 £2,833 £2,281 £2,275

Residual per sq m £117 £3 -£123 -£479

Land benchmark per sq m £54 £25 £51 £101


sq m £63 -£22 -£174 -£581

Other Uses

5.25 The viability testing has been based on the development expected to come forward. It

is acknowledged that there are other uses that could arise and it is recommended that

the following approach is taken:

• A2 Financial and Professional Services – treat as A1 in viability terms as many of

these uses are likely to occupy the same sorts of premises as some town centre

retail.

• A3 Restaurants and Cafes – again treat as A1 in viability terms as many of these

uses are likely to occupy the same sorts of premises as some town centre retail.

• A4 Drinking Establishments - again treat as A1 in viability terms as many of these


• A5 Hot Food Takeaways - again treat as A1 in viability terms as many of these


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• Selling and/or displaying motor vehicles - sales of vehicles are likely to occupy

the same sorts of premises and locations as many B2 uses and therefore the

viability will be covered by the assessment of the viability of B2 uses.

• Retail warehouse clubs – these retail uses are likely to be in the same type of

premises as the out of town A1 retail uses and covering the same purchase or

rental costs.

• Nightclubs – these uses are likely to be in the same type of premises as A1 town

centre retail uses and covering the same purchase or rental costs.

• Scrapyards – there may be new scrapyard/recycling uses in the future,

particularly if the prices of metals and other materials rise. These are likely to

occupy the same sorts of premises as many B2 uses and therefore the viability

will be covered by the assessment of the viability of B2 uses.

• Taxi businesses – these uses are likely to be in the same type of premises as A1

town centre retail uses and covering the same purchase or rental costs.

Therefore, they are covered by this viability assessment.

• Amusement centres – these uses are likely to be in the same type of premises as

A1 town centre retail uses and covering the same purchase or rental costs.

Therefore, they are covered by this viability assessment.

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Summary

5.26 Of the uses tested, only retail comparison, in and out of centre, convenience retail and

budget hotels are clearly viable. These types of development can come forward subject

to the availability of sites. Student accommodation is marginal with only a very small

increase in values needed to produce a viable outcome, and it is likely that this type of

development can also proceed.

5.27 Based on the costs and values in this testing, speculative office, industrial and

warehouse developments are unlikely to be brought forward by the market. However,

this does not preclude local authorities developing new employment spaces, in order to

deliver economic development benefits 43 . In addition, public sector funding from

sources such as the South East LEP can be used to reduce the costs of providing new

employment space. It is also likely that businesses will continue to commission design

and build workspace development.

5.28 High street comparison retail is marginally viable as modelled here. However, this is in

part due to the relatively high existing use value assumed for the prime retail site. If a

lower value site is available, then this type of retail is more likely to come forward. Based

on the costs and values in this testing, care homes and leisure developments are not

viable.

5.29 Figure 5.8 below summarises the viability of the different non-residential uses.

43 This combines a long-term view on returns as well as an ability to borrow cheaply.

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Figure 5.8 - Non-residential Development Viability Summary - £/sq m viability

‘headroom’

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Appendix I – Technical

Detail for Residential

Testing

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House Prices

House Type Detached Semi-detached Terrace Flats Bungalows

Bedrooms 5 Bed 4 Bed 3 Bed 4 Bed 3 Bed 4 Bed 3 Bed 2 Bed 1 bed 2 Bed 1 Bed 2 bed 1 bed

Market GIA (sq m) 160 130 100 120 100 106 84 70 58 61 50 70 55

Tiptree & Rural

(HV) £508,320 £413,010 £317,700 £362,040 £301,700 £327,445 £259,484 £216,237 £179,168 £173,994 £142,618 £280,000 £220,000

Central (LV) £456,640 £371,020 £285,400 £334,680 £278,900 £296,503 £234,965 £195,804 £162,238 £169,613 £139,027 £251,533 £197,633

Notes

• Flats ground rent £250/dwelling capitalised at 5%.

• 5% selling price premium applied to sites of 3 dwellings or less

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Market Housing dwelling mix

Type 25dph 30dph 35dph 40dph –

urban area

1 bed flat

5% 5% 10%

2 bed flat 5% 5% 10%

2 bed bungalow

5%

2 bed terrace 10% 10% 15%

3 bed terrace 10% 15% 10%

4 bed terrace

3 bed semi 20% 15% 10% 10%

4 bed semi

3 bed detached 15% 15% 15% 15%

4 bed detached 40% 30% 30% 30%

5 bed detached 20% 10% 10%

Affordable Housing

Testing to advise on level of (viable) affordable housing: 35% and 30% tested on sites over 10

dwellings. Levels lower than this (e.g. 25%) not tested because sites were clearly viable at 30/35%.

(Garden Communities are to provide 30% affordable housing.)

All affordable housing comprises 80% Affordable Rent and 20% shared ownership on sites of more

than 10 units. (i.e. 11 or more).

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Affordable Housing Dwelling mix

Mix takes account of SHMA

Affordable Housing

Development Mix House Type

Affordable Rent (80%

of AH)

Intermediate (shared

Ownership) (20% of AH)

1 bed flat 10%

2 bed flat 10% 25%

2 bed bungalow 5% (at 25 dph only –

otherwise increase 2

bed flats by 5%)

-

2 bed terrace 45% 50%

3 bed terrace 25% 25%

4 bed terrace 5% -

Affordable housing values

Rents are net of service charge of £10 pw for flats and £5 pw for houses & based on 100% of LHA

rates (rounded)

Weekly rents net

of service charge

Colchester

BRMA

1 bedroom flat £93

2 bedroom flat £122

1 bedroom terrace £98




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Other Affordable Housing Costs

For rental properties.

Management and maintenance £1,000

Voids/bad debts 2.00%

Repairs reserve £600

Capitalisation 5%

For shared ownership

Share size 40%

Rental charge 2.75%

Capitalisation 5%

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General costs and assumptions – all dwellings

Dwelling sizes

House type description Affordable sq m Market sq m

1 bedroom flat 50 (2p) 50

2 bedroom flat 70 (4p) 61

1 bedroom bungalow 55 (2p) 55

2 bedroom bungalow 70 (4p) 70

1 bedroom terrace 58 (2p) 58




3 bed semi detached 93 (5p) 100

4 bed semi detached 106 (6p) 120

3 bed detached

100

4 bed detached

130

5 bed detached

160

Dwelling size compliant with Nationally Described Space Standards

An allowance of 10% of floor area will be added to the 1-2 storey flats used in the 1ha tile testing for

circulation and common areas.

An allowance of 15% of floor area will be added to the 3 storey flats used in case studies C8 and C8A.

For the sheltered scheme, case study C14, one bed flats are 50sqm and two bed flats are 75sqm.

An allowance of 20% of floor area for communal and service areas will be added.

For the extracare scheme, case study C15, one bed flats are 65sqm and two bed flats are 80sqm.

An allowance of 35% of floor area for communal and service areas will be added.

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Other Development and Policy Costs

Type Cost Comment

Flats (1-2 storeys) £1,417 sq m includes 15% for external works

Flats (3-5 storeys) £1,467 sq m includes 15% for external works

Houses £1,250 sq m includes 15% for external works

2 – 3 Houses £1,312 sq m includes 15% for external works (5%

increase over standard houses)

Single House £2,047 sq m includes 15% for external works

Bungalows £1,492 sq m includes 15% for external works

Sheltered Housing £1,449 sq m includes 15% for external works

(assume 3 storey)

Professional fees 8%-12% 10 units or less – 12%

11 – 50 units – 10%

51 – 100 units – 9%

101+ units – 8%

Finance 6% of development costs (net of inflation)

Marketing fees 3%

6%

of GDV

of GDV for sheltered and extracare

schemes

Developer return 20% of GDV

Contractor return 6% of affordable build costs

s106/278 £6,000

£10,000

Per dwelling (based on average from info

supplied by council on past contributions)

Per dwelling for sites over 50 dwellings to

take into account extra education

provision

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Type Cost Comment

Accessibility Allow for 10% market housing

to be to Part M(4) 2 standard.

Allow for 95% affordable

homes to be to Part M(4) 2

standard.

Allow for 5% affordable

homes to be to Part M(4) 3

accessible standards.

Costs based on DCLG Housing Standards

Review, Cost Impacts, September 2014.

Strategic

infrastructure

costs/ opening up

>50 units 50k/net ha

>100 units £100k/net ha

>200 units £150/net ha

>400 units £200/net ha

net ha for larger sites

High cost scenario 5k per unit on sites 300 or

more

10k per unit on sites 600 or

more

Sensitivity test to allow potential for

higher site remediation or infrastructure

Void Costs £100,000 Applies to sheltered and extracare

schemes

Agents and legal 1.75%

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Densities

1ha tiles tested at 25, 30, 35, 40 dph. Higher densities will be included in case studies.

Unless otherwise specified - main density for case studies of 35 dph for case studies

Net to gross ratios:

• Up to 0.2ha – 100%

• 0.2 - 2ha – 90%

• 2 - 8ha - 80%

• 8+ha - 65%

Build out rate approximately 50 dwellings per annum per outlet.

Benchmark Land Values

Colchester Small to medium

sites

Intermediate site Large strategic

Over 20 ha (gross)

Tiptree & Rural £1m £0.75m £0.44m

Central £0.6m £0.5m £0.44m

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Appendix II – Local Plan

Policies

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No Title Policy Requirements Viability Implication

Growth Locations

Policy

SG1

Colchester’s

Spatial Strategy

Throughout the Borough, growth will be located at the most accessible and sustainable

locations in accordance with the spatial strategy for North Essex as set out in Policy SP6.

Development will be focused on highly accessible locations to reduce the need to travel.

This Spatial Hierarchy focuses growth on the urban area of Colchester, the second tier of

preferred growth includes Garden Communities straddling boundaries with adjacent

authorities and providing new greenfield sites in sustainable communities which will grow

gradually. The second tier also includes proportionate growth in existing Sustainable

Settlements.

In the remaining Other Villages and Countryside areas of Colchester, new development

will only be acceptable where it accords with policies OV1 and OV2.

Range of schemes tested in

viability study to cover

development scenarios and the

different scales of delivery likely to

come forward across the

settlement hierarchy. Case study

scenarios provide greater

definition of different urban and

rural development typologies.

Policy

SG2

Housing

Delivery

The Local Planning Authority will plan, monitor and manage the delivery of at least 14,720

new homes in Colchester Borough between 2017 and 2033.

Development sites for the 2017-33 period include new greenfield sites which have been

selected on the basis of their sustainable location and deliverability. The overall

distribution of new housing, as shown in Table SG2, will be guided by the Settlement

Hierarchy set forth in the Spatial Strategy and Policy SG1.

To maintain the vitality and viability of the Borough’s smaller towns and villages, an

appropriate level of new development will be brought forward in Sustainable Settlements

to support new homes and economic and social development.

None

The development requirements

identified are covered by the

generic typologies tested or

addressed as part of more specific

case studies.

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Policy

SG3

Economic

Growth

Provision and

Centre

Hierarchy

The Local Planning Authority will encourage economic development and will plan for the

delivery of at least 55.2 ha (B-Class uses) of employment land in Colchester Borough up to

2033. This will include new sites that are considered sustainable and within strategic

economic areas, local economic areas, mixed use sites and existing sites. Existing

economic uses on the sites identified will be safeguarded in accordance with the relevant

policies.

The development requirements

identified are covered by the

generic typologies tested or

addressed as part of more specific

case studies. Testing considers

development across a range of

non-residential typologies.

Policy

SG 4

Local Economic

Areas

The Local Economic Areas as defined on the policies maps and listed in policy tables SG3

and SG4, will be safeguarded primarily for B class uses to enable balanced job and

housing growth. Planning permission will be granted for the redevelopment or change of

use for non-Class B subject to careful consideration in-line with identified parameters.

Opportunities to enhance and renew more dated buildings within Local Economic Areas

will be supported subject to use and scale.

No specific viability testing and the

policy is not directly relevant for

testing as it primarily looks to

safeguard existing uses. Testing

does allow for brownfield /

previously developed land

benchmarks and case studies

cover a range of development

scenarios which may reflect

redevelopment of existing land or

premises.

Policy

SG5

Centre

Hierarchy

In accordance with the NPPF the centres identified in the Local Plan hierarchy will be the

preferred location for main town centre uses such as retail, office, leisure and

entertainment. Proposals for such uses outside of these centres as defined on the

No specific viability implications

and the policy does not specifically

relate to development

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proposals map will be subject to a sequential test and where applicable to provide an

impact assessment.

requirements. However, testing

does take account of the different

conditions for development across

the plan area.

Policy

SG6

Town Centre

Uses

Proposals for town centre uses that are not within a defined centre and are not in

accordance with the Local Plan will need to demonstrate that a sequential approach

has been under taken to site selection. Sites should be assessed in terms of their

availability, suitability and viability for the broad scale and type of development

proposed; and only when alternative sites have been discounted should less

sequentially preferable sites be considered. In cases where the Local Planning

Authority is satisfied that the sequential test has been met, proposals will be

supported where they also comply with further requirements set out by the council.

No specific viability implications.

The policy is primarily concerned

with criteria for where certain

development types are considered

appropriate. Testing for non-

residential development takes

account of a broad range of types

and locations for these uses,

including Town Centres.

Policy

SG6a

Local Centres Local centres will be protected and enhanced to provide shops, services and

community facilities for local communities. Proposals for change of use within

designated local centres will need to demonstrate that it will provide a retail use, retail

service, community use, financial/ businesses service or a leisure service and will

meet the basic needs of local communities. Proposals to expand a local centre will be

considered favourably where it can be demonstrated that the use is small scale

proportionate to the role and function of such centres. Proposals outside of local centres

will be assessed in accordance with the sequential test. Proposals will be required to

demonstrate that it will not adversely affect the amenity of the locality,


The types and locations for

development covered by the policy

are captured within non-residential

testing scenarios.

Policy

SG7

Infrastructure

Delivery and

All new development should be supported by, and have good access to, all necessary

infrastructure.

This is a generic policy whose

requirements are typically

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Impact

Mitigation

Development will be viewed favourably where there is sufficient appropriate infrastructure

capacity to support the development or sustainable capacity will be delivered by the

proposal.

Where a development proposal requires additional infrastructure capacity, to be deemed

acceptable mitigation measures must be agreed with the Local Planning Authority and the

appropriate infrastructure provider.

addressed by overall assumptions

for levels of planning obligations.

Specific requirements and

estimates of likely contributions

are established having regard to

historic levels of S106

contributions and the

Infrastructure Delivery Plan as well

as reviewing the requirements for

specific sites and development

locations contained in the Plan.

Policy

SG7

Neighbourhood

Plans

Town and villages are encouraged to plan for the specific needs of their communities by

developing Neighbourhood Plans. The Local Planning Authority will support Parish

Councils and Neighbourhood Forums to prepare Neighbourhood Plans, the plans should

aim to promote additional growth to that promoted in the Local Plan and should be in

general conformity with national planning polices and guidance and strategic local

policies.

There are no specific viability

implications for this policy but

testing provides a range of outputs

and scenarios likely to reflect the

type and circumstances of sites

that may be promoted in the

future through Neighbourhood

Plans.

Environmental Assets Policies

Policy

ENV1

Environment The Local Planning Authority will conserve and enhance Colchester’s natural and historic

environment, countryside and coastline and will safeguard the Borough’s biodiversity,

geology, history and archaeology which help define the landscape character of the

Borough.


implications. The means of

complying with the policy are

provided within typical

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In particular, developments that have an adverse impact on the integrity of European

sites, Sites of Special Scientific Interest or the Dedham Vale Area of Outstanding Natural

Beauty (including its setting) will not be supported. Development proposals within

designated areas or within the Coastal Protection Belt will also need to comply with

policies ENV2 and ENV4.

Development proposals where the principal objective is to conserve or enhance

biodiversity and geodiversity interests will be supported in principle. Development will not

be supported in location where it is considered detrimental to the natural environment

subject to sequential tests.

assumptions for development

costs and professional fees (e.g.

ecological surveys) and in most

cases it is expected that

requirements can be

accommodated within typical

development sites (e.g. green

infrastructure and open space)

Policy

ENV2

Coastal Areas Until such time as the South East (Inshore Marine Plan) is completed, any planning

proposals within the Borough’s coastal, estuarine, intertidal and tidal environment, will

need to accord with guidance set out in the national Marine Policy Statement.

Within the Coastal Protection Belt and along the undeveloped coast an integrated

approach to coastal management will be promoted and development will only be

supported where it conforms with the council’s requirements.

In exceptional circumstances, development may be permitted where it is proven that the

proposal provides an overwhelming public or community benefit that outweighs the

impact on the coastal protection belt. In such instances applications must demonstrate

that the site is the only available option and be acceptable in terms of its other planning

merits.


implications. The overall policy

approach is to direct where

development should be directed or

appropriately managed and it is

not envisaged that Coastal Areas

will be expected to deliver a

significant proportion of

development plan requirements.

Policy

ENV3

Green

Infrastructure

The Local Planning Authority will aim to provide a comprehensive green infrastructure

network comprising strategic green links between the rural hinterland, river corridors and

open spaces across the Borough. It will seek to protect and enhance the existing network

of green links and open spaces and to create new green infrastructure that will benefit


implications. The policy seeks to

provide further guidance rather

than additional development

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both wildlife and people. The Local Planning Authority will also work with access

stakeholder/groups to support the development of a ‘new’ multi user route, the Colchester

Orbital, around urban Colchester.

Proposals that cause loss or harm to the green infrastructure network will not be

permitted unless the need for and benefits of the development outweigh any adverse

impacts.

The provision of green infrastructure will be central to the masterplanning and future

development of new garden communities to be developed in the Borough.

The use of land and buildings as new allotments, orchards, community gardens and for

local food growing spaces and production will be supported.

requirements. The means of

complying with the policy are

provided within typical


costs and professional fees (e.g.

ecological surveys). In most cases it

is expected that requirements can

be accommodated within typical

development sites (e.g. through

Masterplanning) and allowances

for planning obligations (e.g. open

space).

Policy

ENV4

Dedham Vale

Area of

Outstanding

Natural Beauty

Development will only be supported in or on land within the setting of the Dedham Vale

Area of Outstanding Natural Beauty (AONB) which is not detrimental to the amenities of

the AONB.

Applications for major development within or in close proximity to the boundary of the

Dedham Vale Area of Outstanding Natural Beauty will be refused unless in exceptional

circumstances and where it can be demonstrated that the development is in the public

interest and this outweighs other material considerations.

Where exceptional development is suitable, landscape enhancements, mitigation or

compensation measures must be provided. The Local Planning Authority will seek

opportunities to mitigate the impact of features identified as having adverse impacts.





appropriately managed. Specific

mitigation is likely to be

determined on a site-by-site basis

but it is not expected that these

areas will provide for a significant

proportion of development plan

requirements.

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Proposals for renewable energy farms on land within the setting of the Dedham Vale

AONB should have regard to the advice in the Local Planning Authority’s Guidance Note

(March 2013).

Policy

ENV5

Pollution and

Contaminated

Land

Proposals will be supported that will not result in an unacceptable risk to public health or

safety, the environment, general amenity or existing uses due to the potential of air

pollution, noise nuisance, surface / ground water sources or land pollution.


implications. Testing scenarios

provide for case studies which

make allowances for additional

‘opening-up’ and enabling costs to

address abnormal development

requirements. Testing also

includes adjustments for gross:net

land area, taking account of

undevelopable parts of larger sites

and includes examples where the

level of planning obligations may

exceed typical averages.

Climate Change Policy

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Policy

CC1

Climate Change Colchester Borough Council will continue to adopt strategies to mitigate and adapt to

climate change. In addressing the move to a low carbon future for Colchester, the Local

Planning Authority will plan for new development in locations and ways that reduce

greenhouse gas emissions, adopt the principles set out in the energy hierarchy and

provide resilience to the impacts of a changing climate. The policy identifies that where

appropriate certain sites may be required to utilise or provide connections to

decentralised energy or CHP networks.

The policy generally provides

encouragement to developers and

is unlikely to impose costs beyond

these included in typical

assumptions for development.

Policy

PP1

Generic

infrastructure

and mitigation

requirements

In addition to site specific requirements identified in relevant policies, all

proposals will be required to make contributions to the cost of infrastructure

improvements and/or community facilities as required and any other generic

infrastructure or mitigation required on a site by site basis. Contributions will be secured

to an appropriate level by way of legal agreement or through CIL as required.


implications. Testing assumptions

make allowances for typical levels

of planning contributions based on

recent records and includes

examples where the allowance for

planning obligations may be

greater, based on the

requirements from new

development.

The majority of the policy’s

requirements can be met through

typical development assumptions

and allowances for open space,

layout and normal build costs.

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Central Colchester

Policy

TC1

Town Centre

Policy and

Hierarchy

Colchester Town Centre is at the top of the retail hierarchy set forth in Policy SG3.

Accordingly, it will be the focus for new Town Centre uses and will be the preferred

location for such uses in relation to the sequential test contained in the National Planning

Policy Framework (paragraph 24).

The Local Planning Authority will encourage development in the Town Centre (as defined

on the Policies Map) which enhances the Borough’s role as a sub-regional shopping and

leisure destination and important tourism destination that is attractive, vibrant and safe.


implications in relation to the

policy. The Viability Study

considers a range of non-

residential development typologies

in different locations across the

Borough.

Policy

TC2

Retail Frontages Given that the Town Centre is the sequentially preferable location in the Borough as a

whole for Town Centre uses, particularly comparison retail, the Local Planning Authority

will seek to maintain at least 70% retail use on each street frontage within the Primary

Shopping Area shown on the Policies Map.

Premises occupying small footprints and flexible ground floor footprints will be

encouraged in these frontages to help support the town’s small/independent town centre

businesses.

This policy is purely related to

development management and

has no direct implications for

viability testing.

Policy

TC3

Town Centre

Allocations

The 2016 Retail Study Update identified a need for 20,000 sq m additional floorspace

capacity for comparison retail uses to 2033, which can be accommodated within the

defined Town Centre boundary. Updated evidence will inform specific allocations within

these areas and additional areas will be allocated within the Town Centre if required. To

address the need for additional town centre use floorspace areas of potential capacity has

been identified and are shown on the Policies Map.

This is an extensive policy covering

a range of proposed allocations for

different uses (sometimes a

combination of mixed-uses). Some

of these allocations include site-

specific requirements for

development reflecting the

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Residential allocations as shown on the Policies Map will be safeguarded for residential

uses only. Individual developments will need to satisfy a range of policy requirements

where appropriate including managing parking provision, impacts on heritage assets and

improvements to the public realm

Additional office floorspace to sustain the Town Centre will be supported just outside the

Town Centre boundary within the Middleborough Local Economic Area as shown on the

Policies Map. In addition, proposals for office use elsewhere in the Town Centre will be

supported where they comply with other policy requirements.

characteristics of different

locations and development

considerations.

Most of the site-specific criteria

follow other policies in the plan

and are allowed for within typical


costs and professional fees e.g.

undertaking surveys and

assessments prior to development

being approved.

Case Study assumptions have

taken into account development

typologies with increased

allowances for opening up costs to

cover issues such as site clearance

and remediation as well as the

characteristics for residential

development reflected by the

proposed allocations e.g. flatted

development.

The Viability Study includes testing

for a variety on non-residential and

commercial uses reflecting the

requirements for employment and

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retail development provided for by

this policy.

Policy

TC4

Transport in

Colchester Town

Centre

Developments in Colchester Town Centre will be expected to contribute to a package of

sustainable transport measures including walking, cycling, public transport, travel planning

and the promotion of sustainable travel. Where it is demonstrated that proposals will

impact on the highway network, contributions will be sought towards mitigation and

improvements.

There are no additional viability

implications in relation to this

policy. The policy requirements are

addressed through typical

allowances for planning

obligations, professional fees,

development costs and

assumptions regarding site density

and layout.

• North Colchester

Policy

NC1

North

Colchester and

Severalls

Strategic

Economic Area

All land and premises within the North Colchester and Severalls Strategic Economic will be

safeguarded for the identified uses based on a zoned approach as defined on the policies

map:

Zone 1 – Primarily focused upon class B uses.

Zone 2 – Mixed uses

Zone 3 – Use class D – Sports and recreational uses

Residential and Public Open Space – development at the existing rugby club will be

safeguarded for employment, residential and open space to deliver the sport and leisure

uses in zone 3



policy. The policy is primarily

associated with identifying the

locations where economic

development is supported.

The Viability Study includes a wide

range of testing for non-residential

and commercial development

typologies which reflect current

evidence for costs and values

across a range of uses and in

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A master plan will be prepared to provide a detailed framework for growth covering part

of the economic area as illustrated on the North Colchester Policies Map.

All proposals within the North Colchester and Severalls Strategic Economic Area will be

required to provide and contribute towards good public transport, pedestrian and cycle

links ensuring good connectivity.

different locations across the

Borough.

Case studies for residential

development include greater

allowances for gross:net

development ratios and increased


obligations (above recent historic

averages) and therefore capture

the additional development costs

associated with residential

development covered under this

policy.

Policy

NC2

North Station

Special Policy

Area

Within the area designated on the policies map as the North Station Special Policy Area,

development which contributes to regeneration of the area will be supported.



policy, which looks to promote

good design and other Local Plan

objectives rather than identifying

specific locations to meet

development requirements and

allocations upon which the plan

relies.

The requirements identified by the

policy are likely to be covered by

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typical costs associated with

development.

Policy

NC3

North

Colchester

Land at Braiswick

In addition to the infrastructure and mitigation requirements identified in policy PP1,

development will be supported on land within the area identified on the policies

map, which is must be comprehensively planned setting out how any proposal will

provide:

• Up to 70 dwellings; and

• Access from Braiswick (road); and

• The retention and enhancement of existing tree belts within the site in addition

to a landscape appraisal to look at opportunities to further improve other

landscape features within the site; and

• No residential development in the area of site within Flood Zone 3; and

• Retention and improvements to the existing Public Right of Way which runs

along the eastern boundary of the site.

The policy identifies specific

allocations for residential uses and

provides further detail on

development requirements.

The policy requirements are

reflected in testing assumptions.

Most requirements form part of

the typical costs associated with

development. This includes

professional fees associated with

surveys prior to development

taking place and accommodating

appropriate provisions for

drainage and landscape within

typical development layouts.







averages) and therefore would

capture the additional

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development costs associated with

residential development covered

under this policy.

Policy

NC4

Transport in

North

Colchester

Developments in North Colchester will be expected to contribute to a package of

sustainable transport measures. Where proposals will impact on the highway network,

contributions will be sought towards mitigation and improvements of specific locations

and projects as identified by the council as part of this plan.









and layout.

Policy

SC1

South Colchester

Allocations

Allocations as shown on the policies map will be safeguarded for residential uses. In

addition to the requirements in Policy PP1, development must comply with the site specific

requirements as identified below.

Land at Gosbecks

• Up to 150 new dwellings

• New bus stop provision to service the site and improve sustainable transport

links to Colchester Town Centre;

• New public art and improvements to the public realm

• A contribution to Gosbecks Archaeological Park.

South of Berechurch Hall Road







reflected in testing assumptions

(see also summary for Policy NC3

above).

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• New bus stop provision to service the site and improve sustainable transport

links to Colchester town centre; and

• A comprehensive approach to development of the three separateparcels of land

which together make up the allocation.

Economic safeguard areas

• 1 hectare of Land at Maldon Road / Shrub Endand Land at Gosbecks.

Policy

SC2

Middlewick

Ranges

The allocation shown on the Policies Map is expected to deliver approximately 1000 new

dwellings. In addition to the infrastructure and mitigation requirements identified in

policy PP1 the development will protect and enhance the amenities of the area creating a

sustainable and attractive environment, provide for open space and ecological mitigation

and provide for remediation of contamination where required.


implications. The policy provides

for a large scale residential

allocation and this type of

development is covered by

assumptions contained in case

studies for larger development

types, including allowances for

opening-up costs, higher levels of

planning obligations and

adjustments between gross and

net developable area.

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Policy

SC3

Transport in

South Colchester

Developments in South Colchester will be expected to contribute to a package of












and layout.

East Colchester

Policy

EC1

Knowledge

Gateway and

University of

Essex Strategic

Economic Area

Essex University is essential to Colchester Borough’s economy and the vitality and viability

of the town centre

The area shown on the Policies Map is designated as the University and Knowledge

Gateway Strategic Economic Area. Within this area development will be supported which

enables significant expansion of the University of Essex. A new University Garden Village is

also proposed to the east of Colchester.

Proposals for the expansion of the University will be required to provide good public

transport, pedestrian and cycle links ensuring good connectivity to and from the town

centre, surrounding area. New development will also be liable for infrastructure

improvements.


implications for this policy.

Testing assumptions include a

range of non-residential and

commercial land uses and

including realistic allowances for

development costs, enabling costs

and planning obligations.

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Policy

EC2

East Colchester -

The Hythe

Special Policy

Area

Development within the area defined on the Policies Map as the East Colchester – Hythe

Special Policy Area will be encouraged and supported where it supports the overall

regeneration of the area and supports policy EC1. Any development proposal will also be

sustainable, maximise the potential open spaces and green infrastructure within the area

and mitigate development against flood risk and climate change. The policy identifies

specific opportunities for infrastructure enhancement in the area including Public Transit

corridors and development of a Combined Heat and Power Network.

This policy provides additional

detail for part of a wider, over-

arching allocation for land at East

Colchester.



which also look at development

across a range of densities. Most

requirements form part of the

typical costs associated with

development. This includes














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locations covered under this

policy.

Non-residential testing allows for a

range of commercial land uses and

mixed-use developments.

Policy

EC3

East Colchester Residential allocations to the east of Colchester, as shown on the policies map, will be

safeguarded for residential uses. Site specific requirements are identified below;

Land at Port Lane


• Access via Port Lane

• Contamination mitigation

• Provides an adequate assessment of the archaeological potential of the site.

East Bay Mill


• Adequate access

• Satisfy Flood Risk assessment and mitigation

• Contamination mitigation

• Provides an adequate assessment of the archaeological potential of the site.

• Create access to river frontage

• Conversion of listed mill, Protecting and enhancing the setting of listed buildings

and the Hythe conservation area.







which include looking at a range of

densities. Most requirements form

part of the typical costs associated

with development. This includes









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• Carries out an air quality assessment

Barrington Road/Bourne Road vacant site

• Approximately 28 new dwellings

• Comprehensive development programme addressing issue of site lying within

different ownerships

• Suitable landscaping and open space

• Access via Knightsfield

Magdalen Street sites


• Accords with Magdalen Street Development Brief (adopted February 2014).

• Carries out an air quality assessment









under this policy.


implications with regards

proposed elements of the

allocation for non-residential uses

and commercial development.

Policy

EC4

Transport in

East Colchester

Developments in East Colchester will be expected to contribute to a package of












and layout.

West Colchester

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Policy

WC1

Stanway

Strategic

Economic Area

All land and premises within the area allocated as the Stanway Economic Area will be

safeguarded for economic / employment uses based on the following zones:

Zone 1 – B class uses only

Zone 2 - The current function of the area will be safeguarded and proposals for

development which are complimentary to this will be supported.

Any proposals within the Stanway Strategic Economic Area will be required to provide

good public transport, pedestrian and cycle links and development will be expected to

contribute to the cost of infrastructure improvements as required.



policy. The policy is primarily

associated with identifying the

locations where economic

development is supported.

The Viability Study includes a wide

range of testing for non-residential

and commercial development

typologies which reflect current

evidence for costs and values

across a range of uses and in

different locations across the

Borough.

Policy

WC2

Stanway Allocations as shown on the policies map, and identified below, will be safeguarded for

predominantly residential uses.

Land between Church Lane, Churchfields and Partridge Way

• Up to 28 dwellings in accordance with Design an Access Statement linked to the

Lakelands Planning Permission.

Land at Chitts Hill

Development of this site will be supported where it also provides;

• A maximum of 100 new dwellings

• Substantive landscaping












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• Access to the site to be restricted to Chitts Hill

• Open space / green infrastructure provisions

• Adequate noise mitigation from the adjacent railway line.

• Further exploration of potential archaeological significance of the site.

Land to the West of Lakelands


• An ecological survey with appropriate mitigation.

• Satisfactory access to be agreed with the Highway Authority

• Further exploration of potential archaeological significance of the site.

• Adequate wastewater and sewage infrastructure

• Appropriate SUDS design

Land at Tollgate Road as shown on the policies map is allocated for public open

space
















under this policy.






Policy

WC3

Colchester Zoo Colchester Zoo is an important as a visitor attraction and contributor to the local economy.

The area shown on the West Colchester Policies Map will be safeguarded for potential

further expansion of Colchester Zoo to provide additional facilities associated with the

Zoo’s vision for growth. The extent of any development ancillary to the zoo, such as

The policy provides specific

guidance and direction for a

specific location and land use in

the Borough and does not directly

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additional retail, hotel and food and drink outlets, will need to be related to the function of

the zoo and assessed against potential negative impacts on the town centre. Policy

requirements include preparation of a Masterplan; comprehensive Transport and Heritage

Impact Assessments; provision of SUDs; and compliance with the policies of the Minerals

Local Plan.

relate to providing development

requirements which the plan relies

upon.

Policy

WC4

West Colchester Allocations as shown on the policies map will be safeguarded for residential uses and be

required to satisfy additional site specific requirements as identified below;

Essex County Hospital site, Lexden Road

• Accords with the Essex County Hospital adopted Development Brief (December

2014)

Land at Gosbecks Phase 2


• New bus stop provision

• Adequate protection / enhancement of the Scheduled Ancient Monument and its

setting and any Pre-determination archaeological investigation

• New public art and improvements to the public realm.

• A contribution to Gosbecks Archaeological Park.

South of Berechurch Hall Road


• New bus stop provision

• A comprehensive approach to development of the three separate parcels of land

which together make up the allocation.

• Pre-determination archaeological investigation





















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Land at Irvine Road


• Access via existing track off Irvine Road

• A maximum development area of 40% of the site;

• An Ecological Management Plan and Mitigation Plan for the remaining 60%

Land at Maldon Road / Shrub End – 1ha for economic uses.







under this policy.






Policy

WC5

Transport in

West Colchester

Developments in East Colchester will be expected to contribute to a package of












and layout.

Sustainable Settlements

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Policy

SS1

Abberton and

Langenhoe

Development proposals on land to the west of Peldon Road as shown on the policies map

will be supported which provides:

• Up to 50 dwellings

• Safe access to and from the highway to be agreed with the Highway Authority;

• Assessment of the Peldon Road/Layer Road junction as part of a Transport

Assessment;

• A Landscape Appraisal and strategy

• Adequate wastewater treatment and sewage infrastructure


• The potential archaeological significance of the site should be further explored

Land to the east of Peldon Road as shown on the policies map will be supported which

provides:

• Up to 5 dwellings

• Safe access to and from the highway to be agreed with the Highway Authority

• Suitable screening and landscaping to mitigate effect on listed building

Both proposed development sites will be well connected and provide contributions to the

nearby primary school.

Pantiles Farm on Peldon Road is allocated as a Local Economic Area and will continue to

be protected for this use. Any future development proposals will be required to comply

with policy SG4

This policy relates to specific land

use allocations at other

settlements within the Borough.






















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under this policy.

Policy

SS2

Boxted All development proposals in Boxted as shown on the Policies Map, will be required to

comply with policies in the Boxted Neighbourhood Plan and any relevant Local Plan

policies.

Prior to the commencement of development at Hill Farm enhancements will need to be

provided to the wastewater treatment and sewerage infrastructure in the catchment.


requirements in relation to this

policy

Policy

SS3

Chappel Housing

Sites

As shown on the policies map the site at Chappel shall provide:


• A single site access via Swan Grove.

• Adequate water supply, wastewater treatment and sewage infrastructure


• Suitable landscape strategy













Policy

SS4

Copford Housing

Sites

Within each site shown on the Copford Proposals Map development will be supported

which provides:



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• Appropriate SuDS design

• Appropriate landscaping scheme

land to the east of Queensberry Avenue - Up to 70 new dwellings and upgraded public

right of way along western boundary.

land to the west of Hall Road - Up to 50 new dwellings, a single site access via Hall Road

and detailed flood modelling to assess flood risk at Hall Road from Roman River.

• A safe pedestrian footway agreed with the Highways Authority from the site to

London Road to enhance connectivity with Copford











Policy

SS5

Eight Ash Green The Neighbourhood Plan shall effectively plan for the Eight Ash Green area and will:

• Define a new Settlement Development Boundary

• Identify specific site(s) for housing allocations to deliver up to 150 dwellings.

• Set out any associated policies needed to support this housing delivery including

infrastructure & community facilities

Proposals for development outside of the identified broad areas for growth will not be

supported.

The policy does not relate to

specific allocation proposals.








Plans.

Policy

SS6

Fordham Within the area shown on the policies map development will be supported which provides;


• Access from Plummers Road with appropriate junction improvements;




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• Well connected public rights of way

• Archaeological investigation



• Appropriate landscaping scheme













Policy

SS7

Great Horkesley Within the areas shown on the policies map new development will be supported which

provides:

• Contributions towards improving walking and cycling facilities along the A134;

• Contributions to enhancing community buildings;



Land adjacent to Great Horkesley Manor:

• 80 new dwellings

• Provision of allotments;

• Provision of a scout hut with parking;

• Retention of the belt of trees to the east of the site;

• Access from Nayland Road;














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• Provision of footways and suitable traffic management and crossing opportunities

on Nayland Road;

• Acceptable landscape strategy

• Minerals Resource Assessment

Land off School Lane:

• 13 new dwellings;

• Development will facilitate access to the old village hall and contribute to the

replacement of the scout hut;

• Access from School Lane;

• Development will safeguard the setting of the Church of England School building as

a grade 2 listed building and other heritage assets on The Causeway.

The designated Local Economic Area at Holly Lodge Farm shown on the policies map will

be retained and any future development proposals at this site will be required to accord

with policy SG4.













under this policy.

Policy

SS8

Great Tey In addition to the infrastructure and mitigation requirements identified any proposed

development will be supported on land as identified on the policies map and include:

Land on Brook Road

• 10 new dwellings, which shall include some single storey units

• Suitable design and screening/landscaping to minimise any negative impact on

the adjacent Conservation Area and listed building

Land off Greenfield Drive

• 30 new dwellings with access off Greenfield Drive











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• A minimum of 1ha of public open space adjacent to existing public open space.

Tey Brook Farm is an allocated Local Economic Area as shown on the policies map and will

be protected for this use.






Testing assumptions allow for the

provision of bungalows (single

storey dwellings) and Rural

Exception Sites and therefore

reflect the specific provisions

under this policy.

Policy

SS9

Langham Development on land shown the Policies Map will be supported where they meet the

requirements identified below for each site;

Wick Road


School Road

• 70 new dwellings including smaller family homes and sheltered housing

• One site to the east of the Powerplus site to accommodate 40 dwellings plus a car

park for the school

• One site to the west of the Powerplus site to accommodate 30 dwellings plus an

extension to the adjacent recreation ground

• A landscape Appraisal














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• A design and layout which protects and enhances the listed buildings

including their setting

The Powerplus Engineering and Whitnell Contractors site on School Road, Langham

Airfield (Lodge Lane) and The Depot, Old Ipswich Road, in Langham are designated Local

Economic Areas as shown on the polices map. The sites will remain allocated as such.













under this policy.

Case studies include allowances

for sheltered housing and

therefore reflect the specific

provisions sought by this policy.

Policy

SS10

Layer de le Haye In addition to the infrastructure and mitigation requirements any proposed


map which provides:


• Primary highways access to serve the development from Greate House Farm

Road with secondary, non-thoroughfare access, from The Folley to serve a limited

number of dwellings;









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• New areas of public open space and equipped children’ s play area

• A Masterplan demonstrating how the development will positively and

comprehensively relate to the future delivery of a rural exceptions site on adjacent

land


















under this policy.

Testing assumptions allow for the

provision of bungalows (single

storey dwellings) in some

typologies and Rural Exception

Sites and therefore reflect the

specific provisions under this

policy.

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Policy

SS11

Marks Tey

Growth within the Marks Tey area will largely be guided by the following documents

in addition to this Local Plan:

• The Joint Plan Development Plan document to be prepared with Braintree

District Council

• The Marks Tey Neighbourhood Plan

The Anderson’ s site is allocated as a Local Economic Area as shown on the Policies

Map.










Plans.

New Garden Communities may be

associated with specific strategic

infrastructure requirements but

these are subject to separate

testing and viability modelling.

Policy

ss12a

West Mersea In addition to the infrastructure and mitigation requirements development will be

supported on land within the areas identified on the policies map which contributes

towards expanding Mersea Island Primary School and meets the requirements for each

site indicated below;

Dawes Lane


• Public Open Space and children’ s play area to adjacent to The Glebe

• A single site access off Dawes Lane










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• Suitable landscaping scheme to protect the open rural character of land within

the Coastal Protection Belt.

Brierley Paddocks Development will be supported which provides:


• An access via Seaview Avenue

• New public open space

There are three existing designated Local Economic Areas in Mersea as shown on the

policies map that will continue to be safeguarded for this use.







Policy

ss12b

Coast Road,

West Mersea

Development proposals on the seaward and landward side of Coast Road, West Mersea,

will be supported where they:

• Are located within the area defined as the developed coast and the

development is such that a coastal location is required

• Enhance historic assets, maritime uses, the traditional maritime character

of Coast Road and the landscape character of the coast

• Can safeguard or mitigate effects upon the adjacent European sites

• Will deliver or sustain social and economic benefits to coastal communities

• Will not generate a significant increase in traffic

• Represent an appropriate use with regards to flood risk.

In exceptional circumstances, development may be permitted where it is proven that the

proposal provides an over-whelming public or community benefit that outweighs all





appropriately managed and it is

not envisaged that the Coast Road

area will be expected to deliver a

significant proportion of

development plan requirements.

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other material considerations. In such instances applications must demonstrate that the

site is the only available option and be acceptable in terms of its other planning merits.

Houseboats

Proposals for new moorings for permanent residential houseboats will not be

permitted in coastal areas including Coast Road. Houseboat proposals for new moorings

on historic vacant sites may be acceptable.

Police

SS12c

Mersea Island

Caravan Park

Development proposals at caravan parks on Mersea Island will be supported where they:

• Have adequate wastewater treatment and sewage infrastructure

• Help protect the integrity of European sites and minimise disturbance to

migratory or over wintering birds

• Minimise impact on the amenity of nearby residents or businesses

• Are supported with a Site Specific Flood Risk Assessment and management

plan

• promote sustainable travel for leisure on Mersea.

Permission will not be granted for caravans or chalets at the caravan parks to be used as

permanent residences.


implications. The uses covered

under the policy requirements are

not directly related to those

covered by the viability testing.

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Policy

SS13

Rowhedge In addition to the infrastructure and mitigation requirements identified in policy PP1,


map which provides:


• Ecological and arboricultural assessments of the site and mitigation as

required

• An area of open space between the site and existing housing

• Provision of new health services to be agreed with the North Essex

Care Commissioning Group

























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under this policy.

Policy

SS15

Tiptree Within the broad areas of growth shown on the Tiptree Policy Map, the Tiptree

Neighbourhood Plan will:

• Identify the settlement boundary for Tiptree

• Identify specific sites for housing allocations needed to deliver 600 dwellings.

• Set out any associated policies needed to support this housing delivery,

infrastructure and community facilities

Proposals for development outside of the identified broad areas and the settlement

boundary for growth will not be supported.










Plans.

Policy

SS16

West Bergholt Within the broad area of growth as shown on the West Bergholt Proposals map, the West

Bergholt Neighbourhood Plan will:

• Identify the settlement boundary for West Bergholt

• Identify specific sites for housing allocations needed to deliver 120 dwellings.

• Set out any associated policies, supported by local evidence of need, needed to

support this housing delivery, infrastructure and community facilities

• Identify any additional local economic areas

Proposals for development outside of the identified broad areas for growth and the

settlement boundary will not be supported.

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Policy

SS16

Wivenhoe Within the broad areas of growth as shown on the Wivenhoe policies map, the

Wivenhoe Neighbourhood Plan will:

• identify the settlement boundary for Wivenhoe

• Identify specific sites to deliver 250 dwellings

• Set out any associated policies needed to support this housing delivery and

any infrastructure requirements to support new development.

• Identify other allocations in the Parish, including employment and open space

Proposals for development outside of the identified broad areas settlement boundary

for growth will not be supported.










Plans.

Other Villages and Countryside

Policy

OV1

Development in

Other Villages

The Local Planning Authority will support proposals that enhance the vitality of rural

communities and help maintain the sense of community provided by smaller rural villages

and in rural areas.

Applications will be supported for well-designed limited infill developments, development

on previously developed sites, and extensions, restorations or alterations to existing

buildings that are within the defined settlement boundaries.


implications. The policy specifically

relates to development

management issues in identifying

where more limited levels of

development will be considered

appropriate.

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Policy

OV2

Countryside Development, other than residential, which may require a countryside location must

demonstrate a rural location need and adhere to Policy DM6 (Economic development in

rural areas and the countryside).

Residential development in the countryside, outside defined settlement boundaries, will

be restricted to small scale rural exception sites needed to meet local affordable housing

needs.


Development Management

Policy

DM1

Health and

Wellbeing

All development should be designed to help promote healthy lifestyles and avoid causing

adverse impacts on public health.

Health Impact Assessments (HIA) will be required for all residential development in excess

of 100 units and non-residential development in excess of 2500 square metres. Measures

to mitigate any adverse impacts of the development will be provided and / or secured by

planning conditions, Section 106 contributions or CIL.


implications. Testing assumptions

allow for typical levels of planning

obligations plus normal costs for

development including

professional fees. Increased


obligations are considered within

the testing assumptions for larger

sites.

Policy

DM2

Community

Facilities

Where existing community facilities and services meet, or will meet an identified local

need, these assets will be retained. Any proposal that would result in the loss of a healthy

viable community asset will only be supported in cases where either an alternative site is

secured within walking distance.


implications. The policy primarily

relates to existing facilities but

assumptions for new development

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If possible facilities should be enhanced to serve new development and the Local Planning

Authority will work with developers, local partners, such as Town/ Parish Councils or

Community Associations, to plan and manage community facilities.

include typical allowances for

planning obligations.

Policy

DM3

New Education

Provision

Existing or recent educational sites shall be protected for that use. The change of use, or

re-development of educational establishments and their grounds, will not be permitted

unless:

• The site is genuinely redundant and no other alternative educational, or

community use can be found

• Satisfactory alternative and improved facilities will be provided

• The area of the site to be redeveloped is genuinely in excess of Government

guidelines for playing field provision

The Local Planning Authority will respond positively to appropriate and well-designed

applications regarding the creation of new school and education facilities.



relates to specific educational

uses.

Testing assumptions take account

of allowances for planning

obligations associated with the

infrastructure requirements for

new development including

education provision.

Policy

DM4

Sports Provision New and existing sports and leisure facilities will be protected and enhanced to encourage

active lifestyles and to increase participation in formal and informal recreation. The

delivery of new sports facilities will be mainly focused at hub sites identified across the

borough. Development which removes such facilities will be carefully assessed.



relates to specific sports uses.


of allowances for planning

obligations associated with the

infrastructure requirements for

new development including sports

provision.

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Policy

DM5

Tourism,

Leisure, Culture

and Heritage

Development for new and extended visitor attractions, leisure, cultural and heritage

facilities along with visitor accommodation will be supported in suitable locations subject

to minimising their impact on neighbouring areas, transport infrastructure and natural

areas including the AONB.



relates to specific tourism and

leisure uses and managing existing

facilities.

Policy

DM6

Economic

development in

rural areas and

the countryside

The Local Planning Authority will protect Local Economic Areas in rural Colchester that

provide an economic function both on allocated sites shown on the proposals maps and at

other rural locations that provide a similar function.


implications. The policy specifically

relates to development

management issues in identifying

where more limited levels of

development will be considered

appropriate or existing uses

safeguarded.

Policy

DM7

Agricultural

Development

and

Diversification

The Local Planning Authority will support and encourage appropriate farm diversification

proposals where they help support the rural economy, are compatible with the rural

environment and help to sustain the existing agricultural enterprise without the need for

subdivision of the holding or separate enterprises unrelated to the existing agricultural

use. Proposals that are likely to have an adverse impact on the AONB will not be

supported.



relates to specific development

management matters and land

uses not directly related to the

viability study.

Policy

DM8

Affordable

Housing

The Local Planning Authority will be seeking to secure 30% of new dwellings (including

conversions) on housing development for more than 10 dwellings to be provided as

affordable housing, normally through provision on-site. For housing developments of

The viability study directly

addresses the requirements of this

policy.

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between 6 and 10 units located in designated rural areas there will be a requirement for

30% affordable housing of new dwellings (in accordance with Planning Practice Guidance).

Where it is considered that a site forms part of a larger development area, affordable

housing will be apportioned with reference to the site area as a whole.

For sites where an alternative level of affordable housing is proposed below the target, it

will need to be supported by evidence in the form of a viability appraisal. In exceptional

circumstances, where high development costs undermine the viability of housing delivery,

developers will be expected to demonstrate an alternative affordable housing provision.

Affordable housing development in the villages will be supported on rural exception sites

contiguous with village settlement boundaries, provided a genuine local need can be

demonstrated.


of various potential levels of

affordable housing provision

(including the policy requirement

of 30%) taking into account current

estimates of costs and values and

across a range of different market

areas reflecting different viability

characteristics in the Borough.

Testing further takes account of

Rural Exception Sites and

considers the inclusion of ‘starter

homes’ as part of sensitivity testing

as part of emerging national policy

and legislation although these are

not directly covered by the policy.

Policy

DM9

Development

Density

The Local Planning Authority will seek development densities that make efficient use of

land and relate to the specific opportunities and constraints of proposed development

sites. Proposals with development densities that encourage sustainable transport and

help sustain local amenities will be supported.



policy. The development typologies

and case studies used in testing

include a mix of development at

different densities likely to be

delivered across the plan area.

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Policy

DM10

Housing

Diversity

The Local Planning Authority intends to secure a range of housing types and tenures on

developments across the Borough in order to create inclusive and sustainable

communities. The Local Planning Authority will seek to provide for the needs of particular

groups including: Specialist Housing, Older people, Self-build/custom-build housing,

Gypsies and Travellers, Students and St Helena Hospice.



policy. The development typologies

and case studies used in testing

include the provision of sheltered

accommodation for the elderly and

‘Care Home’ schemes as part of

non-residential testing

assumptions.

The housing mix used in different

development typologies also

includes single storey (bungalow)

properties for certain development

densities.

Case Study scenarios also include

testing assumptions for typical

examples of ‘self-build’ sites for

those looking to build their own

home.

Policy

DM11

Gypsies,

Travellers, and

Travelling

Showpeople

The Local Planning Authority will identify sites to meet the established needs of gypsies,

travellers and travelling show people in the Borough in line with the 2014 assessment

carried out for the Essex area. Proposals for any further applications will be judged on a

case by case basis.

The policy is primarily related to

managing specific land uses and

the needs of specific groups. This

policy is not relevant to the

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development types covered by the

viability study.

Policy

DM12

Housing

Standards

Residential development will be guided by high standards of design, construction and

layout. The Building For Life assessment tool should be used to inform design on all new

major residential developments. Residential development will be planned to minimise

vulnerability to climate change impacts. The policy includes requirements for parking and

also sets out the following standards:

(i) Internal space standards demonstrated to be in accordance with the National

Described Space Standards (DCLG, 2015) or any future replacement of this;

(ii) A minimum of 10% of market housing and 95% of affordable housing to meet

Building Regulations 2015 Part M4 (2) accessible and adaptable standards and

5% of affordable homes to be Part M4 (3)(2)(b) wheelchair user standards.

This policy is directly relevant to

the testing assumptions for the

study. The unit types included in

the housing mix for all typologies

are consistent with the national

space standards.

Testing includes the allowances for

accessible and adaptable homes in

all scenarios where these

requirements apply.

The other requirements of this

policy are captured by typical

estimates for development costs

and typical layouts in terms of

aspects such privacy, open space

and vehicle parking.

Policy

DM13

Domestic

development:

Residential

alterations,

extensions and

outbuildings

Residential alterations, extensions and outbuildings will be permitted, provided the

proposal is of a high-quality design which is in keeping with the scale, design and character

of the original dwelling house, streetscene and locality and does not unacceptably impact

upon the residential amenity of the area. Residential annexes are considered acceptable

where they remain ancillary to the main dwellinghouse.



policy.

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Proposals for the conversion and sub-division of existing residential premises within

settlement boundaries into flats and other self-contained residential units will be

considered having regard to the intensity of the use proposed and the sustainability of the

location and satisfactory living conditions being provided.

Policy

DM14

Rural Workers

Housing

Permanent Rural Workers Dwellings

Planning permission will be granted for new agricultural workers dwellings as part of

existing businesses, established for over 3 years, where Evidence is provided showing an

essential functional need for a full time worker to be situation permanently onsite.

Temporary Rural Workers Dwellings

Where evidence is provided to support a new dwelling which is deemed essential to

support a new activity, whether a newly-created unit or an established one, temporary

accommodation will be granted for up to 3 years.

Conditions will be attached to any permissions granted for new rural workers dwellings to

remove permitted development rights and restrict the occupancy to that required for the

rural business concerned or other agricultural/rural use nearby. If a property can no

longer be associated with a rural worker then the council must carefully asses the removal

of any condition(s) to allow the property to become a residential dwelling.



policy.

Policy

DM15

Design and

Amenity

All development, including new build, extensions and alterations, must be designed to a

high standard, positively respond to its context, achieve good standards of amenity, and

demonstrate social, economic and environmental sustainability.



policy. The criteria for design and

amenity relate to site-specific

development management

requirements but are reflected in

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typical assumptions regarding

costs and development layout.

Policy

DM16

Historic

Environment

Development that will lead to substantial harm to or total loss of significance of a listed

building, conservation area, historic park or garden or important archaeological remains

(including development that adversely affects the setting of heritage assets) will only be

permitted in exceptional circumstances where the harm or loss is necessary to achieve

substantial public benefits that outweigh the harm or loss.



policy. Testing assumptions

include allowances for professional

fees including necessary surveys as

part of demonstrating that

development is acceptable.

Testing assumptions for some case

studies include additional


obligations and enabling costs and

are likely to capture instances

where the costs of complying with

policy requirements are greater,

but this is likely to be determined

on a site-by-site basis.

Policy

DM17

Retention of

Open Space and

Recreation

Facilities

The Local Planning Authority will protect and enhance the existing network of green links

and open spaces and secure additional areas where deficiencies are identified. The

provision of public open space in developments should be informed by an appraisal of

local context and community need and up to date evidence, with a regard to the impact of

site development on biodiversity.

This policy is primarily related to

the management of existing

facilities and land uses. There are

no specific viability implications.

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Development, including change of use, of any existing or proposed public or private open

space, including allotments (as identified on the Proposals Map) will not be supported

without careful consideration by the local planning authority.

Policy

DM18

Provision for

Public Open

Space

New development must provide for the recreational needs of new communities and

mitigate impacts on existing communities to increase opportunities for participation in

healthy lifestyles. All new residential development will be expected to provide at least 10%

of the total gross area of the site as new public areas of accessible open space.



study. Case studies for all sites of

11 or more dwellings include an

adjustment for net to gross site

area ratio of at least 90% to

accommodate the requirement to

provide on-site open space.

Allowances for planning

obligations reflect recent averages

and reflect the costs of complying

with this policy.

Policy

DM19

Private Amenity

Space

The Local Planning Authority will expect all new homes to provide easy access to high

quality private/communal open space. The area of open space should be informed by the

needs of residents and the accessibility of the location.

All new residential development shall provide private amenity inline with the councils

standards.


implications. The provision of

private open space is accounted

for within typical assumptions for

development costs and typical site

layout.

Policy

DM20

Promoting

Sustainable

The Local Planning Authority will work with developers and other partners to increase

modal shift towards sustainable modes by improving accessibility of development through


implications. Development

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Transport and

Changing Travel

Behaviour

the promotion of walking and cycling as an integral part of development, and by further

improving public transport. In line with policy SG1 Colchester Spatial Strategic

development that reduces the need to travel will be encouraged and sustainable transport

will be improved to provide better connections between communities and their needs. All

development should adhere to the content of Essex County Council’s Highway Authority

Development Management Policies.

The Local Planning Authority will support improvements to the strategic road, rail and

cycle network where appropriate. Where appropriate the use of sustainable travel in rural

areas will be encouraged to minimise the impact of transport on sensitive rural areas.

assumptions include allowances

for planning obligations typically

required to make development

acceptable and reflecting recent

rates.

Policy

DM21

Sustainable

Access to

Development

All new developments should seek to enhance accessibility for safe. accessible and

sustainable modes of transport including walking, cycling and public transport.

All developments that generate significant amounts of movement or are of a residential or

education use will be required to produce a Travel Plan in accordance with Essex County

Council Travel Plan Framework guidance.


implications. Development

assumptions include allowances

for planning obligations typically

required to make development

acceptable and reflecting recent

contribution rates.

Policy

DM22

Parking The amount of car parking to be provided in association with new residential development

will be assessed using the most recent local Parking Guidance. Secure cycle parking should

be incorporated into all residential development proposals.

Parking standards for non-residential development should be agreed through joint

discussions with the local Highway Authority and the Local Planning Authority in

accordance with the most recent local Parking Guidance.

Applications for new or expanded car parking provision will be considered on an individual

basis in relation to evidence and need.


implications. Provision for car

parking is allowed for in typical

assumptions for development cost

and site layout.

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Greater use of Park & Ride will be encouraged especially for trips to the town centre and

other major establishments along the route of the service. Further Park and Ride sites will

be developed to help support growth and give access to the town centre.

Parking should incorporate facilities for electric vehicle charging and other ultra-low

emission vehicles.

Policy

DM23

Flood Risk and

Water

Management

The Local Planning Authority will seek to direct development away from land at risk of

flooding in accordance with the National Planning Policy Framework and the Planning

Practice Guidance, taking into account, areas where the risk of flooding is likely to increase

as a result of climate change. The sequential test as set out in national guidance has

informed the allocation of sites in the Local Plan and will also be applied in determining

planning applications on new sites coming forward outside of those allocated.

Developments are required to comply with the Surface Water Management Plan (SWMP)

(or updates if appropriate). All development should include appropriate provision for

Sustainable Drainage Systems (SUDs) for managing surface water runoff within the overall

design and layout. Brownfield development should seek to achieve post-development

runoff rates equivalent to that of its greenfield condition and development within SWMP

Critical Drainage Areas should seek betterment to a greenfield runoff rate. It is

recommended that a SUDS treatment train is utilised to assist in this reduction



policy.

Testing assumptions include

allowances for professional fees

including necessary surveys as part

of demonstrating that

development is acceptable.

Testing assumptions for some case

studies include additional


obligations and enabling costs and

are likely to capture instances

where the costs of complying with

policy requirements are greater,

but this is likely to be determined

on a site-by-site basis.

The costs of complying with the

SUDs elements of the policy

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should not exceed those of

providing development in

accordance with Building

Regulations, accepting that costs

and values should take account of

the requirements to re-use

previously developed land.

Policy

DM24

Sustainable

Urban Drainage

Systems

All new residential and development of 10 dwellings or more and major commercial

development, car parks and hard standings should incorporate Sustainable Drainage

Systems (SUDs) appropriate to the nature of the site.

Only where there is a significant risk of pollution to the water environment, inappropriate

soil conditions and/or engineering difficulties, should alternative methods of drainage be

considered.



policy beyond those summarised

for Policy DM23

Policy

DM25

Renewable

Energy, Water,

Waste and

Recycling

The Local Planning Authority’s commitment to carbon reduction includes the promotion of

efficient use of energy and resources, alongside waste minimisation and recycling.

The Local Planning Authority will support housing developments that help reduce carbon

emissions in accordance with national Building Regulations. Non-residential developments

will be encouraged to achieve a minimum BREEAM rating of ‘Very Good’.

Colchester Borough is an area of serious water stress and to achieve greater efficiencies in

new developments the Local Planning Authority will require residential development to

incorporate water saving measures in line with the tighter optional requirement of Part G2

of national Building Regulations of 110/l/h/d.



study. The development costs for

non-residential typologies take into

account the requirement to meet

the BREEAM ‘Very Good’ standard.

No specific adjustment to


costs is made in relation to

meeting the optional requirement

for water efficiency standards

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The Local Planning Authority will support proposals for renewable energy projects at

appropriate locations in the Borough to help reduce Colchester’s carbon footprint subject

to visual and residential amenity considerations.

110/l/h/day. Evidence indicates this

equates to an additional cost of

approximately £9 / dwelling and is

addressed within the sensitivity

testing for higher costs on

different case study scenarios

which significantly exceed these

amounts.

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Appendix III – Stakeholder

Workshop Presentation &

Notes

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North Essex Viability Workshop Notes – 13 March 2017, 10am – 12pm

Weston Homes Community Stadium, Colchester

(List of delegates available on request)

Consultant and Officer Team

Emma Goodings, Braintree District Council (introductory presentation)

Rob Smith – HYAS

Laura Easton – Three Dragons

Troy Hayes – Troy Planning + Design

Jon Goodall – Troy Planning + Design

Introduction:

The opening part of the session was an introduction by Council Officers to report on the approach

and progress towards preparing the new Local Plans for Braintree District, Colchester Borough and

Tendring District Councils.

‘Part 1’ Presentation:

A presentation on viability assumptions and modelling being developed for the three new Garden

Communities and allocated through the ‘Part 1’ Local Plan covering strategies matters for the three

authorities was given separately. The assumptions and outputs from this work are not directly

related to the ‘whole plan’ viability study being undertaken for each of the separate ‘Part 2’ Local

Plans.

Whole Plan Viability Study Presentations: (see slides on following pages)

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The following questions were received, noted and where possible responses given as set out below:

Part 1

Question / Response: To confirm, Benchmark land value - £100k per gross acre

Question: What are assumptions for affordable housing? Big need for older people – how is this

being tested? Inputs are expected at a detailed level in terms of values, rental levels etc.

Answer: Wider Evidence Base will tell us. More information is provided by the Whole Plan Viability

Study such as Local Authority Housing Allowance rates.

Question: Cost of Obligations and opening up at £40k - £50k per unit is that across tenures?

Answer: Yes

Part 2

Questions: Where 2 bed accommodation is included in any mix, this needs to be 4 persons

Answer: Comments appreciated and a valuable point to pick-up in further discussions with

Registered Providers

Question: Market Dwelling Mix different for Part 1 and Part 2?

Answer: Yes that may be the case. However, for the Part 2 studies across the three authorities the

broad mix across the notional 1ha tiles is likely to be similar in terms of house type and size based

on the SHMA recommendations. Some specific variations are allowed for e.g. lower density in

Tendring and also picking up other scenarios through the case studies.

Question: inference in HWP for increasing densities, how is this being addressed?

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Answer: We will be testing different densities, including higher densities in more urban areas and

lower densities in Tendring. The notional 1ha scenarios equate to around 3,400sqm of floorspace

per hectare, which seems in-line with typical developments.

Question: 50 units per outlet seems reasonable for private. May be reasonable to see this as the

top-end.

Answer: 3 or 4 outlets at peak. Can’t get to 4 outlets straight away. This appeared to be generally

agreed by delegates.

Question: Square footage from EPC, that wasn’t presented. Important as a 3 bed unit can vary

considerably. You would typically always see a premium for detached properties.

Answer: The consultant team agree to circulate a summary table of what had been done to

assemble raw data. Will circulate with the slides.

Question: How do you judge the geographies for different market areas?

Answer: Important to look at other data sets and speaking to agents. Rightmove data is also a good

proxy. Samples of new build are large and increasing given recent rates of development – in some

other local authority areas they can be much smaller. EPCs – we try to ensure at least 100 – 200

examples. Remove skewed transactions. Strike a reasonable balance.

Question: Benchmark Land Values. How has the consultant team arrived at these? They look like

the wrong way around with Braintree seeming to be the highest.

Answer: Looked at previous studies and DCLG estimates. Not clear why the Braintree figures are

coming out so much lower. We are still researching this and this is just the beginning. The values

are subject to change based on any increase in sample size, review of EPC data, removing anomalies

and liaison with local agents. Any sales particulars of plots and asking prices for recent

developments would be much appreciated.

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Full Sample of Housing Transactions Data Circulated with Slides from 13 March 2017 Developer Workshop

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Appendix IV – Results tables

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1 hectare tiles – Full Results

Area / DPH / AR-SO Split / %AH / Other Costs RESULTS

% Affordable Housing Benchmark Values

Market Value Area Density Borough

Rented / Intermediate %AH

% Market Housing

Part M Costs

allowed

Total Market

Sqm

Residual Value (£)

Benchmark / hectare

(£)

Sensitivity Benchmark

(£)

RV less Main

Benchmark

RV less Sensitivity Benchmark

Central 25dph Colchester 80% / 20% 30% 70% 29,711 2143.80 £1,236,000 £600,000 £720,000 £636,000 £516,000








Tiptree & Rural

25dph Colchester 80% / 20% 30% 70% 29,711 2143.80 £1,731,000 £1,000,000 £1,200,000 £731,000 £531,000

Tiptree & Rural

30dph Colchester 80% / 20% 30% 70% 35,577 2236.60 £1,661,000 £1,000,000 £1,200,000 £661,000 £461,000

Tiptree & Rural

35dph Colchester 80% / 20% 30% 70% 41,506 2589.80 £1,924,000 £1,000,000 £1,200,000 £924,000 £724,000

Tiptree & Rural

40dph Colchester 80% / 20% 30% 70% 47,347 2663.10 £1,834,000 £1,000,000 £1,200,000 £834,000 £634,000

Tiptree & Rural

25dph Colchester 80% / 20% 35% 65% 34,089 1990.70 £1,573,000 £1,000,000 £1,200,000 £573,000 £373,000

Tiptree & Rural

30dph Colchester 80% / 20% 35% 65% 40,836 2076.80 £1,500,000 £1,000,000 £1,200,000 £500,000 £300,000

Tiptree & Rural

35dph Colchester 80% / 20% 35% 65% 47,642 2404.90 £1,738,000 £1,000,000 £1,200,000 £738,000 £538,000

Tiptree & Rural

40dph Colchester 80% / 20% 35% 65% 54,365 2472.90 £1,648,000 £1,000,000 £1,200,000 £648,000 £448,000

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Case Study – Full Results (Central Market Value Area)

Case Study Ref No of Dwgs

Market Value Area %AH

% self

build Density (dph)

Net Area (ha)

Gross area (ha)

Net to

Gross %

S106/ dwelling

Part M Costs

allowed



DCF Applied

Residual Value / gross ha

Benchmark / hectare

(£)

Residual value post benchmark

(£)

Small Site Case Studies

C1 1 dwelling Central 0% 0% 40 0.025 0.025 100% 6,000 139 Nil No -920,000 600,000 -1,520,000

C2 3 dwellings Central 0% 0% 40 0.075 0.075 100% 6,000 416 Nil No 2,080,000 600,000 1,480,000

C3 7 dwellings Central 0% 0% 35 0.200 0.222 90% 6,000 938 Nil No 1,932,432 600,000 1,332,432

C3 7 dwellings Central 30% 0% 35 0.200 0.222 90% 6,000 938 Nil No 1,216,216 600,000 616,216

Medium Site Case Studies

C5 11 dwellings Central 30% 0% 35 0.315 0.350 90% £6,000 13,045 Nil No 1,234,286 600,000 634,286

C5A 11 dwellings Central 35% 0% 35 0.315 0.350 90% £6,000 14,973 Nil No 1,100,000 600,000 500,000

C6 15 dwellings Central 30% 0% 35 0.429 0.477 90% £6,000 17,788 Nil No 1,228,512 600,000 628,512

C6A 15 dwellings Central 30% 0% 35 0.429 0.477 90% £10,000 17,788 Nil No 1,111,111 600,000 511,111

C6B 15 dwellings Central 30% 0% 25 0.600 0.666 90% £6,000 17,826 Nil No 1,120,120 600,000 520,120

C6C 15 dwellings Central 30% 0% 25 0.600 0.666 90% £10,000 17,826 Nil No 1,036,036 600,000 436,036

C7 50 dwellings Central 30% 0% 35 1.429 1.571 91% £10,000 59,294 £50,000 Yes 1,109,157 600,000 509,157

C8A 100 dwellings

Central 30% 0% 100 1.000 1.111 90% £10,000 74,919 £100,000 Yes -774,042 600,000 -1,374,042

C8 60 dwellings Central 30% 0% 60 1.000 1.111 90% £10,000 44,952 £50,000 Yes -418,687 600,000 -1,018,687

Intermediate Case Studies

C9 75 dwellings Central 30% 0% 35 2.143 2.678 80% £10,000 88,941 £50,000 Yes 1,076,440 500,000 576,440

C10 125 dwellings

Central 30% 5% 40 3.125 3.900 80% £10,000 140,857 £100,000 Yes 869,155 500,000 369,155

C11 300 dwellings

Central 30% 5% 35 8.571

13.187 65% £10,000 337,977 £150,000 Yes 625,176 500,000 125,176

C11 300 dwellings

Central 30% 5% 35 8.571

13.187 65% £15,000 337,977 £150,000 Yes 529,688 500,000 29,688

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Case Study Ref No of Dwgs

Market Value Area %AH

% self

build Density (dph)

Net Area (ha)

Gross area (ha)

Net to

Gross %

S106/ dwelling

Part M Costs

allowed



DCF Applied


Benchmark / hectare

(£)


(£)

Large Case Studies

C12 600 dwellings

Central 30% 5% 35

17.143

26.374 65% £10,000 675,954 £200,000 Yes 610,086 440,000 170,086

C12 600 dwellings

Central 30% 5% 35

17.143

26.374 65% £20,000 675,954 £200,000 Yes 435,334 440,000 -4,666

C12A 600 dwellings

Central 30% 5% 30

20.000

30.769 65% £10,000 675,954 £200,000 Yes 528,557 440,000 88,557

C12A 600 dwellings

Central 30% 5% 30

20.000

30.769 65% £20,000 675,954 £200,000 Yes 378,857 440,000 -61,143

C13 1100 dwellings

Central 30% 5% 35

31.429

48.352 65% £10,000

1,239,249

£200,000 Yes 589,088 440,000 149,088

C13 1100 dwellings

Central 30% 5% 35

31.429

48.352 65% £20,000

1,239,249

£200,000 Yes 432,743 440,000 -7,257

Sheltered and Extracare Housing

C14 50 dwellings Central 30% 0% 100 0.500 0.500 100% £6,000 Assume

compliant 100,000 void

costs Yes 1,602,748 600,000 1,002,748

C15 50 dwellings Central 30% 0% 100 0.500 0.500 100% £6,000 Assume


costs Yes 1,298,640 600,000 698,640

Rural Exception Sites

C4 10 dwellings Central 70% 20 0.500 0.500 100% 6,000 29,046 Nil No

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Case Study – Full Results (Tiptree and Rural Market Value Area)

Case Study

Ref No of Dwgs Market Value

Area %AH

% self

build Density (dph)

Net Area (ha)

Gross area (ha)

Net to

Gross %

S106/ dwelling

Part M Costs

allowed



DCF Applied


Benchmark / hectare

(£)


(£)

Small Site Case Studies

C1 1 dwelling Tiptree & Rural 0% 0% 40 0.025 0.025 100% 6,000 139 Nil No 80,000 1,000,000 -920,000

C2 3 dwellings Tiptree & Rural 0% 0% 40 0.075 0.075 100% 6,000 416 Nil No 2,840,000 1,000,000 1,840,000

C3 7 dwellings Tiptree & Rural 0% 0% 35 0.200 0.222 90% 6,000 938 Nil No 2,698,198 1,000,000 1,698,198

C3 7 dwellings Tiptree & Rural 30% 0% 35 0.200 0.222 90% 6,000 938 Nil No 1,729,730 1,000,000 729,730

Medium Site Case Studies

C5 11 dwellings Tiptree & Rural 30% 0% 35 0.315 0.350 90% 6,000 13,045 Nil No 1,745,714 1,000,000 745,714

C5A 11 dwellings Tiptree & Rural 35% 0% 35 0.315 0.350 90% 6,000 14,973 Nil No 1,580,000 1,000,000 580,000

C6 15 dwellings Tiptree & Rural 30% 0% 35 0.429 0.477 90% 6,000 17,788 Nil No 1,740,042 1,000,000 740,042

C6A 15 dwellings Tiptree & Rural 30% 0% 35 0.429 0.477 90% 10,000 17,788 Nil No 1,622,642 1,000,000 622,642

C6B 15 dwellings Tiptree & Rural 30% 0% 25 0.600 0.666 90% 6,000 17,826 Nil No 1,564,565 1,000,000 564,565

C6C 15 dwellings Tiptree & Rural 30% 0% 25 0.600 0.666 90% 10,000 17,826 Nil No 1,480,480 1,000,000 480,480

C7 50 dwellings Tiptree & Rural 30% 0% 35 1.429 1.571 91% 10,000 59,294 £50,000 Yes 1,600,670 1,000,000 600,670

C8A 100 dwellings Tiptree & Rural 30% 0% 100 1.000 1.111 90% 10,000 74,919 £100,000 Yes -531,633 1,000,000 -1,531,633

C8 60 dwellings Tiptree & Rural 30% 0% 60 1.000 1.111 90% 10,000 44,952 £50,000 Yes -271,508 1,000,000 -1,271,508

Intermediate Case Studies

C9 75 dwellings Tiptree & Rural 30% 0% 35 2.143 2.678 80% 10,000 88,941 £50,000 Yes 1,509,800 750,000 759,800

C10 125 dwellings Tiptree & Rural 30% 5% 40 3.125 3.900 80% 10,000 140,857 £100,000 Yes 1,280,229 750,000 530,229

C11 300 dwellings Tiptree & Rural 30% 5% 35 8.571

13.187 65% 10,000 337,977 £150,000 Yes 923,038 750,000 173,038

C11 300 dwellings Tiptree & Rural 30% 5% 35 8.571

13.187 65% 15,000 337,977 £150,000 Yes 833,135 750,000 83,135

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Case Study

Ref No of Dwgs Market Value

Area %AH

% self

build Density (dph)

Net Area (ha)

Gross area (ha)

Net to

Gross %

S106/ dwelling

Part M Costs

allowed



DCF Applied


Benchmark / hectare

(£)


(£)

Large Case Studies

C12 600 dwellings Tiptree & Rural 30% 5% 35

17.143

26.374 65% 10,000 675,954 £200,000 Yes 904,964 440,000 464,964


17.143

26.374 65% 20,000 675,954 £200,000 Yes 737,797 440,000 297,797

C12A 600 dwellings Tiptree & Rural 30% 5% 30

20.000

30.769 65% 10,000 675,954 £200,000 Yes 782,418 440,000 342,418

C12A 600 dwellings Tiptree & Rural 30% 5% 30

20.000

30.769 65% 20,000 675,954 £200,000 Yes 639,238 440,000 199,238


31.429

48.352 65% 10,000 1,239,249 £200,000 Yes 859,181 440,000 419,181


31.429

48.352 65% 20,000 1,239,249 £200,000 Yes 704,605 440,000 264,605

Sheltered and Extracare Housing

C14 50 dwellings Tiptree & Rural 30% 0% 100 0.500 0.500 100% 6,000 Assume


costs Yes 2,601,242 1,000,000 1,601,242

C15 50 dwellings Tiptree & Rural 30% 0% 100 0.500 0.500 100% 6,000 Assume


costs Yes 2,539,486 1,000,000 1,539,486

Rural Exception Sites

C4 10 dwellings Tiptree & Rural 70% 20 0.500 0.500 100% 6,000 29,046 Nil No

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Appendix V – Non-

residential Viability Testing

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Non-residential Viability Assessment ModelOffice development of two storeys out of town (a/c multiple units)

Size of unit (GIA) 1500 sq m

Ratio of GEA to GIA 100.0% User input cells

GEA 1500 sq m Produced by model

NIA as % of GIA 95% Key results

NIA 1425 sq m GEA Gross external area

Floors 2 GIA Gross internal area

Site coverage 40% NIA Net internal area

Site area 0.19 Hectares

SCHEME REVENUE

Headline annual rent (in £s per sq m) £161

Rent premium 0%

Headline annual rent (in £s per sq m) with BREEAM premium 161£

Annual rent for assesment (total) - NIA 230,081£

Yield 7.00%

(Yield times rent) 3,286,864£

Less purchaser costs 5.80 % of yield x rent

Gross Development Value 3,106,677£

SCHEME COSTS

Build costs 1,273£ per sq m 1,909,500£

Additional build costs -£ per sq m -£

Water efficiency 0.00% of base build costs -£

External costs 10% of base build costs 190,950£

Total construction costs 2,100,450£

Professional fees 10.00% of construction costs 210,045£

Sales and lettings costs 3% of GDV 93,200£

S106 costs (not covered by CIL) 20,000£

Total 'other costs' 323,245£

Finance costs 6.0% Interest rate

Build period 10 Months

Finance costs for 100% of construction and other costs 121,185£

Void finance/rent free period (in months) 12 Months 145,422£

Total finance costs 266,606£

Developer return 20% Scheme value 621,335£

Total scheme costs 3,311,637£

RESIDUAL VALUE

Gross residual value 204,960-£

Less purchaser costs 0.00 % Stamp duty land tax -£

2.00 % Agent/legal purchase fees -£

Residual value For the scheme 209,059-£

Equivalent per hectare 1,114,983-£

Not viable

Viability

Benchmark land value (per hectare) 675,000£

Equivalent benchmark land value for site 126,563£

Scheme viability headroom 335,622-£

Viability headroom per sq m NONE

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Non-residential Viability Assessment ModelOffice development of four storeys town centre (a/c )









SCHEME REVENUE


Rent premium 0%



Yield 6.75%




SCHEME COSTS








S106 costs (not covered by CIL) -£







Developer return 20% Scheme value 1,002,319£


RESIDUAL VALUE






Not viable

Viability





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Non-residential Viability Assessment ModelFour industrial/warehouse units in a block of 1,600 sqm edge of town









SCHEME REVENUE


Rent premium 0%



Yield 6.75%




SCHEME COSTS

Build costs 795£ per sq m 1,272,000£
















RESIDUAL VALUE






Not viable

Viability





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Non-residential Viability Assessment ModelWarehouse/industrial unit of 5,000 sqm edge of town, accessible location









SCHEME REVENUE


Rent premium 0%



Yield 6.75%




SCHEME COSTS



Water efficiency 2.00% of base build costs 50,000£














RESIDUAL VALUE





Equivalent per hectare 108,591-£

Not viable

Viability





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Non-residential Viability Assessment ModelWarehouse/industrial unit of 5,000 sqm edge of town, accessible location









SCHEME REVENUE


Rent premium 0%



Yield 6.75%




SCHEME COSTS

















RESIDUAL VALUE





Equivalent per hectare 108,591-£

Not viable

Viability





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Non-residential Viability Assessment ModelOut of centre comparison retail multiple units totalling 1,000 sqm









SCHEME REVENUE


Rent premium 0%



Yield 6.60%




SCHEME COSTS

Build costs £690 per sq m 690,000£




Total construction costs 759,000£












RESIDUAL VALUE

Gross residual value 579,924£

Less purchaser costs % Stamp duty land tax 18,496£

2.00 % Agent/legal purchase fees 11,598£

Residual value For the scheme 549,829£

Equivalent per hectare 2,199,317£

Go to next stage

Viability

Benchmark land value (per hectare) 1,000,000£


Scheme viability headroom 299,829£

Viability headroom per sq m 300£

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Non-residential Viability Assessment ModelSmall Convenience Store 300 sqm









SCHEME REVENUE


Rent premium 0%



Yield 6.70%

(Yield times rent) 884,776£


Gross Development Value 836,272£

SCHEME COSTS

Build costs 1,213£ per sq m 363,900£




Total construction costs 400,290£



S106 costs (not covered by CIL) -£





Void finance/rent free period (in months) 0 Months -£



Total scheme costs 654,870£

RESIDUAL VALUE


Less purchaser costs % Stamp duty land tax 628£




Go to next stage

Viability





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Non-residential Viability Assessment ModelMid Size Convenience of 900 sqm









SCHEME REVENUE


Rent premium 0%



Yield 6.20%




SCHEME COSTS

















RESIDUAL VALUE






Go to next stage

Viability





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Non-residential Viability Assessment ModelSupermarket of 2,500 sqm









SCHEME REVENUE


Rent premium 0%



Yield 5.40%




SCHEME COSTS

















RESIDUAL VALUE

Gross residual value 1,017,719£





Go to next stage

Viability





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Non-residential Viability Assessment Model70 bedroom budget hotel out of town





NIA 2327.5 sq m GEA Gross external area




SCHEME REVENUE

Capital value per room 80,000£

Rooms 70

Gross capital value 5,600,000£

Less purchaser costs 5.80 % of gross capital value


SCHEME COSTS

















RESIDUAL VALUE






Go to next stage

Potential for CIL


Viability 132,300£

Potential for CIL for the scheme 154,792£

Potential per sq m 63£

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Non-residential Viability Assessment ModelStudent accommodation of 44 studios and 115 cluster flat rooms





NIA 5286.75 sq m GEA Gross external area

Rooms 159 GIA Gross internal area

Floors 4 NIA Net internal area

Site coverage 75%


SCHEME REVENUE

Room value 105,000£ 16,695,000£



SCHEME COSTS




Professional fees 12.00% of construction costs 1,188,550£


Planning obligations -£

-£

Total 'other costs' 1,661,944£



Finance costs for 100% of construction and other costs 1,040,988£

Void finance period (in months) 0 Months -£

Total finance costs 1,040,988£



RESIDUAL VALUE


Less purchaser costs Stamp duty land tax -£

2.00 % Agent/legal purchase fees 326£


Equivalent per hectare 86,148£

Go to next stage

Potential for CIL



Viability 123,144-£

Headroom per sq m NONE

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Non-residential Viability Assessment ModelEdge of centre mixed leisure development









SCHEME REVENUE


Rent premium 0%



Yield 6.70%




SCHEME COSTS

















RESIDUAL VALUE






Not viable

Viability





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Non-residential Viability Assessment ModelCare home 60 bedrooms









SCHEME REVENUE

Capital value per room 95,000£

Rooms 60

Gross capital value 5,700,000£

Less purchaser costs 5.80 % of gross capital value


SCHEME COSTS

















RESIDUAL VALUE

Gross residual value 1,409,997-£



Residual value For the scheme 1,438,197-£


Not viable

Viability


Viability 303,750£

Scheme viability headroom 1,741,947-£


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THREE DRAGONS

http://three-dragons.co.uk

01908 561769

4 Leafield Rise, Two Mile Ash,

Milton Keynes MK8 8BU

TROY PLANNING + DESIGN

www.troyplanning.com

0207 0961 329

3 Waterhouse Square,

138 Holborn, London EC1N 2SW

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